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Honda GM low-cost electric vehicle cooperation failed!

2024-06-17 Update From: AutoBeta autobeta NAV: AutoBeta > News >

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AutoBeta(AutoBeta.net)10/26 Report--

According to the latest news from foreign media, Honda and GM said on Wednesday that they would abandon their plans to jointly develop economical pure electric vehicles.

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Honda president Toshihiro Mibu said in an interview that the company had cancelled plans to develop economical electric vehicles with GM because of business prospects. The two sides have been engaged in various discussions over the past year, but given the cost and commercialization, the original goal seems difficult to achieve, Mr Miku said.

Back in April 2022, Honda and GM announced an in-depth partnership to build a series of low-cost trams based on next-generation Ultium battery technology. The first models are scheduled to go on sale in North America in 2027 and are expected to sell for less than $30, 000, challenging Tesla's dominance of electric cars in sales.

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In recent years, with the rising cost of raw materials and key components, even Tesla can not bear the price increase, and the in-depth cooperation between Honda and GM will not only reduce manufacturing costs if they successfully launch electric vehicles with less than $30, 000. it can also accelerate the expansion of electric vehicle market share. Most importantly, the Model 3 and Model Y models launched by Tesla in North America continue to grow due to low prices, making Tesla dominant in the electric vehicle industry, while electric cars with less than $30, 000 will have higher market explosive power and will indeed be quite price attractive to the market.

GM has previously said it will promote carbon neutrality in its global products and operations by 2040 and zero emissions from light vehicles in the US by 2035. Honda says it aims to achieve global carbon neutrality by 2050. This cooperation agreement is part of the efforts of the two companies to achieve the goal of carbon neutrality.

In order to achieve the goal of carbon neutrality, the two companies have worked closely together. Not only does Honda own a stake in GM's self-driving car subsidiary Cruise, but the two automakers are also jointly developing Cruise Origin self-driving electric vehicles. In addition, the two companies have set up a joint venture in Michigan to develop and produce hydrogen fuel cell systems.

For now, the cooperation between Honda and GM to launch low-cost electric cars has failed, mainly because of GM.

On Oct. 24, GM reported third-quarter revenue of $44.131 billion, up 5.35% from a year earlier. Net profit attributable to ordinary shareholders was $3.038 billion, down 7.32 per cent from a year earlier. As for the decline in third-quarter profit, GM said it was partly due to the impact of the UAW and UAW strikes, which reduced third-quarter profit by about $200m. In terms of sales, GM sold 1.619 million vehicles worldwide in the third quarter, of which 674300 were sold in the United States and 542000 in China.

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GM withdrew its full-year profit guidance because of the uncertainty caused by the UAW strike after it expected to earn between $12 billion and $14 billion before interest and tax in 2023. At the same time, GM announced delays in the production of several pure electric models, including the GMC Sierra and the Chevrolet Silverado. Maribala explained that GM is adjusting its electric vehicle strategy and that previous attempts to promote the entry market will no longer be GM's future goal, and that the main focus will be on reducing the cost of future vehicle production.

As for Honda, Minhong three of CEO did not talk about the impact of the UAW strike on GM when asked about it. Cost and mileage restrictions were one of the reasons for the cancellation of the cooperation. 'We thought it would be very difficult in business, so the company chose to end the development of an entry-level electric car, 'Mr. Mitsuke said. After the two sides break up, Honda will face the challenge of electric car development on its own.

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Although Honda and GM have failed in the development of low-cost electric cars, there are still other partnerships between the two companies. Honda officially unveiled the Prologu model at the 2023 Tokyo Motor Show. It is understood that the Prologue positioning medium-sized pure electric SUV is the first model jointly built by Honda and General Motors, and the Chevrolet Blazer model is based on GM's Ultium platform, and offers a single motor / a twin motor version to choose from. At present, Honda Prologu has been listed on the North American website and may announce its listing at any time.

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In addition, Honda, GM and GM's self-driving subsidiary Cruise announced on October 19 that it plans to set up a joint venture in the first half of 2024 to provide driverless rides in central Tokyo, Japan, in early 2026. Under the new service, the six-seater Cruise Origin, developed jointly by GM, Cruise and Honda for self-driving rides, will pick up passengers at designated locations and take them to their destination entirely by autopilot. The service will start with dozens of Cruise Origins and then expand to a fleet of 500 Cruise Origins. The three companies then plan to expand their services beyond downtown Tokyo.

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