News

Discontinuation of Joint EV Plan by GM and Honda

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Andrew R. Michaud

• October 25, 2023

Overview

General Motors (GM) and Honda Motor have decided to discontinue their plan to develop a line of lower-priced electric vehicles (EVs), as revealed by a Honda spokesperson on Wednesday. This decision comes a year and a half after the two companies had initially announced their joint effort.

Initial Plan and Expectations

In April 2022, GM and Honda had announced their collaboration to develop a series of lower-cost EVs, with an aim to offer these vehicles at a price below $30,000 in the U.S market. Moreover, the companies had envisioned producing millions of these cars equipped with GM's Ultium battery starting from 2027.

Current Status and Future Projects

While the plan for affordable EVs has been scrapped for the time being, GM and Honda are still engaged in various collaborative projects. An example of this is their joint initiative to introduce a driverless ride service in Tokyo, which was recently announced.

Industry Concerns

The discontinuation of the joint EV plan between GM and Honda reflects a growing apprehension among automakers regarding the profitability and viability of the EV market. Just a day before this announcement, GM had abandoned its target of manufacturing 400,000 EVs by mid-2024, citing a decline in demand for these vehicles.