Honda, LG to Build $3.5B Ohio Battery Plant

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Honda Motor Co. Ltd. and LG Energy Solution have teamed up for the construction of a new battery plant in Fayette County, Ohio, to meet the growing demand for electric vehicles (EVs). The joint venture intends to break ground on the $3.5 billion project in early 2023, with completion estimated by the end of 2024.

The facility will total between 2.5 million and 3 million square feet and manufacture advanced lithium-ion battery cells exclusively for Honda’s battery-powered EVs that are sold in North America. The joint venture is looking to start mass production by the end of 2025, eventually aiming at an annual production of approximately 40 GWh.

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LG will retain a majority stake of 51 percent in the battery plant, while the remaining 49 percent will be owned by Honda. The partners intend to increase their overall investment in the joint venture to $4.4 billion.

Expected to create 2,200 jobs, the manufacturing facility will come online some 40 miles southwest of Columbus, near Jeffersonville, Ohio, on a 450-acre greenfield site that the partners selected in October. Later that month, the State of Ohio announced it would support the project with tax incentives and infrastructure improvements totaling more than $156 million, according to The Columbus Dispatch.

EVs creating industrial demand

This battery plant will help Honda achieve its carbon-neutrality goal to have 100 percent of its new vehicle sales be either battery- or fuel-cell EVs by 2040. Many other car makers have adopted similar targets, leading to demand increase for facilities that produce EV batteries and their components.

In October, Ascend Elements broke ground on a 500,000-square-foot manufacturing facility that will produce cathode materials, a key component for EV batteries. Earlier in the year, SEMCORP Advanced Materials Group selected Sidney, Ohio, for a 850,000-square-foot plant that would manufacture separator film, another essential EV battery component.

Major car brands looking to invest in EVs have also fed the demand for industrial space. In October, Hyundai broke ground on a $5.5 billion manufacturing facility near Savannah, Ga., while Toyota announced plans to invest another $2.5 billion into its existing battery manufacturing facility in North Carolina in August.