Honda Has Ended Its Deal To Make Cheap EVs With GM

Bad news for people who like affordable electric cars: Honda and General Motors won’t be teaming up to make cheaper EVs anymore. They had a plan to create new electric cars that cost less, but they canceled it. They were going to build these cars for North America, South America, and China, and they were expected to come out in 2027. However, on Thursday, they said it was not happening.

“After extensive studies and analysis, we have come to a mutual decision to discontinue the program. Each company remains committed to affordability in the EV market,” Honda and GM said in a joint statement.

“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,” said Honda CEO Toshihiro Mibe in an interview with Bloomberg. “GM and Honda will search for a solution separately. This project itself has been canceled,” Mibe said.

The project that got canceled was going to use GM’s Ultium batteries. GM introduced these batteries in 2020, and they were supposed to be cheap. But things didn’t go as planned. In July, GM had to stop making BrightDrop vans in Canada because they didn’t have enough battery cells. From January to September 2023, they only delivered 6,920 Ultium-based EVs to customers, including the Chevrolet Blazer, Silverado EV, Hummer, Lyriq, and BrightDrop van.

In comparison, Chevrolet sold 49,494 Bolts during the same nine months. These Bolts use older and more expensive batteries. GM had said they were going to stop making Bolts this year and start building electric trucks in 2024. But now, it looks like the electric truck production won’t start until late 2025.

GM said the reason for the delay with Ultium batteries was a problem with their equipment supplier.

But don’t worry, Honda and GM are still working on other projects together. They are making electric crossovers like the Honda Prologue and Acura ZDX, and they will have Apple CarPlay and Android Auto. GM is removing these features from their cars starting in 2024.

GM and Honda are also working with other car companies like BMW, Hyundai, Kia, Mercedes-Benz, and Stellantis to create a fast-charging network in North America. They want to have 30,000 fast chargers in the US and Canada by 2024.

Honda is also planning to start a robotaxi service in Japan in 2026 using an autonomous electric vehicle called the Cruise Origin, which is made by a company GM supports. However, there was a recent incident in California where a Cruise AV hit and dragged a pedestrian, so this news comes at a tricky time.

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