Honda Motor and General Motors are dropping their plan to jointly develop lower-priced electric vehicles (EVs), a Honda spokesperson confirmed on Wednesday.
The two had 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 believed they may be able to create “affordable” EVs, including compact crossover vehicles, built using GM’s Ultium battery technology, but realized it would be difficult to achieve.
So, “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.
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.
- Reuters with additional tiding by Jim Pollard