<article><p class="lead">Japanese automaker Honda Motor is planning to invest $4.2bn in Ohio so that it can expand its electric vehicle (EV) and lithium-ion battery supply chains. </p><p>The largest part of the investment is the $3.5bn the automaker plans to spend on a joint venture lithium-ion battery factory with South Korean battery maker LG Energy Solutions. The two companies plan on completing construction in 2024 with production reaching 40 GWh/yr capacity sometime in 2025.</p><p>The second part of Honda's planned investment is to spend $700mn at its Anna engine plant, Marysville, auto plant, and East Liberty auto plant. The investment will allow the Anna engine plant to produce battery cases which will be combined with modules from the joint venture at the Marysville facility and made into EV batteries which will be used to make cars at Marysville and East Liberty auto plants.</p><p>Honda is expanding its EV supply chains in North America to begin vehicle production there in 2026. The Japanese automaker wants 40pc of its sales in North America to be either battery electric or fuel cell vehicles by 2030. Globally, Honda is aiming to reach a production rate of 2mn EVs/yr in that same year. </p><p>LG Energy Solution is focused on expanding its lithium-ion battery making capacity in North America primarily through joint ventures. The battery maker is planning to build joint venture production facilities with General Motors in <a href="https://metals.argusmedia.com/newsandanalysis/article/2029142">Ohio</a>, <a href="https://metals.argusmedia.com/newsandanalysis/article/2206359">Tennessee</a>, and <a href="https://metals.argusmedia.com/newsandanalysis/article/2295341">Michigan</a>. European automaker Stellantis is also building a lithium-ion production plant with LG in <a href="https://metals.argusmedia.com/newsandanalysis/article/2314848">Windsor, Canada</a>. </p><p>This investment follows the Biden administration's recently passed Inflation Reduction Act which incentivizes auto and battery makers to expand their supply chains in North America. Under <a href="https://metals.argusmedia.com/newsandanalysis/article/2363473">the Inflation Reduction Act</a>, EVs only qualify for a full tax credit if 50pc of their battery components are made in North America starting in 2024.</p><p class="bylines">By Andrew Saucer</p></article>
