TOKYO (Reuters) -Honda Motor and General Motors are scrapping plans to jointly develop affordable electric vehicles (EVs), a Honda spokesperson said on Wednesday, confirming a Bloomberg News report.
The two agreed in April last year to develop a series of lower-priced EVs based on a new joint platform, producing potentially millions of cars from 2027.
The automakers had said the deal was for “affordable” EVs, including compact crossover vehicles, built using GM’s Ultium battery technology.
“After conducting some research and analyses, both parties decided to end the development,” Honda said. “Each company will continue to work towards offering affordable models to the EV market.”
Honda said there was no change in its plan to sell only electrified vehicles by 2040.
Bloomberg first reported the decision, citing an interview with Honda CEO Toshihiro Mibe.
“After studying this for a year, we decided that this would be difficult as a business, so at the moment, we are ending development of an affordable EV,” Mibe said in the interview.
GM did not immediately respond to Reuters’ request for comment.
On Tuesday, GM withdrew its previous 2023 profit projections and its short-term plans for EV production due to the escalating costs related to United Auto Workers strikes, which surged to $200 million per week in October.
(Reporting by Daniel Leussink in Tokyo, Gursimran Kaur in Bengaluru; Editing by Janane Venkatraman and Mark Potter)
