Curbside Newsstand: General Motors, Honda Announce North American Alliance

Automakers around the globe are planning to embark on substantial electrification programs. As a result, a number of partnerships, alliances, tie-ups, and agreements have taken place recently between companies that were once (and probably still are) rivals, aimed at reducing costs so each company can proceed with EV development without going bankrupt. It seems every company is taking a somewhat different approach to electrification, and no one is really sure which path is the best way forward. But General Motors and Honda feel that their approach, which will involve joint EV development and platform sharing, is what’s best for them.

GM and Honda have a history of sharing technology that goes back almost twenty years. In 2004, shoppers could opt for the Honda 3.5 liter V6 and five speed automatic transmission in the Vue. And GM cooperated with Toyota on small cars with NUUMI between 1984 and 2010. The American automaker seemingly learned nothing from either of those endeavors. This time, things may be different. Tesla, despite being a much smaller company, is leading the industry when it comes to nearly all aspects of EV technology. Everyone is playing catch up at this point. But most non-luxury automakers aren’t solely racing to reach parity with Tesla – they’re also going to have to face competitors who have launched or will soon introduce their own battery-powered vehicles.

To that end, GM previously announced that they’ve begun their own EV program centered around a proprietary battery family, entitled Ultium. These batteries, which are currently being developed with LG Chem, promise large capacities and substantially reduced costs when compared to current prices. GM revealed that their Ultium batteries will initially boast a capacity range that starts at 50 kWh to 200 kWh. That last number is perhaps the most intriguing figure, as Tesla presently offers a maximum 100 kWh battery in the Model S and X. Rivian, which will introduce two utility EV models in 2021, will offer a 180 kWh battery as the range-topping powertrain in both vehicles.

Perhaps more importantly, GM is claiming a cost breakthrough when it comes to battery manufacturing. They’re claiming that the future LG Chem-supplied batteries will cost below $100 per kWh. That price point, if it holds true, would represent a substantial reduction with contemporary battery pricing, which in 2019 sat at around $156 per kWh. A sharp reduction (approximately 70 percent) in the use of cobalt is likely a key part of why that figure is so low.

Honda’s involvement with GM’s Ultium batteries isn’t anything new. The company announced they’d use the batteries in April. Basically, two future Honda EV models will not only incorporate Ultium batteries, they’ll also be available with OnStar and Super Cruise. They’re slated for a 2024 model year release, which means we’ll potentially see them in 2023. They’ll also be manufactured in America by GM and use GM’s upcoming global EV platform. Per AutoBlog, Honda will be responsible for developing the interior, exterior, and driving dynamics of the two EVs.

This is a bit of an about face for the Japanese automaker, who as recently as last year seemingly suggested that more substantial EV offerings were slightly farther off. Honda also killed the fully electric variant of the Clarity earlier in 2020 and will not bring the E small car to America. Presumably, the company feels that they don’t need any EVs until these new models arrive later in the decade.

Today’s announcement is a non-binding alliance centered on a strategic tie-up in North America. Building on the Ultium-related technology sharing initiative, both companies will collaborate on new vehicle platforms, electric and internal combustion powertrains, and other areas like infotainment, connectivity, and driver assistance systems. Naturally, it’s tempting to speculate how this new partnership will play out. Will this allow GM to stay in the mid-size game with an Accord-based Malibu? Will the next generation NSX and Corvette share some DNA with each other? Will we see General Motors employ Honda’s hybrid technology in vehicles like the Equinox and Traverse?

Regardless of what future products are derived from the joint effort, it’s incredibly advantageous for both companies to team up. Honda could help GM strengthen its front-wheel drive based offerings while GM will no doubt help the smaller Japanese automaker reduce costs. Honda probably won’t add any GM trucks to its lineup, but freeing up development costs for its rear-wheel based platforms might allow GM to continue building Cadillac sedans and the Chevy Camaro, as of this writing is rumored to meet its end by 2030.

Speculation aside, both automakers have lots of work to do. As previously mentioned, Honda didn’t really commit to EVs until this year. GM is also talking a big game with the upcoming Hummer “revival” and some EV concepts like the Cadillac Lyriq. But the Bolt hasn’t exactly lit the world on fire. They haven’t introduced any unambiguously successful EV in America thus far. And previous attempts at alternative-energy powered vehicles have failed. Remember the Volt? Or the Malibu hybrid?

Additionally, Ford seems to be a bit farther ahead than GM in terms of introducing a fully electric pickup. Plus, their continued push into hybrid technology might possibly pay off handsomely when the 2021 F-150 hybrid is introduced in a few short months. And that’s to say nothing of the Mustang Mach-E, which just might be the closest Tesla competitor yet, although final range figures have yet to be announced.

And of course there’s Tesla, which recently hinted at increased battery capacity. Hyundai is also going full steam ahead on their electric vehicles too. It’s starting to look something like the Wild West in the automotive industry right now, at least in regards to EV development, and pretty soon everyone is going to be pointing six shooters at each other, figuratively speaking. That is, of course, assuming shoppers even start buying EVs en masse, which is by no means guaranteed to happen. That being said, the General Motors/Honda alliance is a prudent course of action. And whatever the outcome, it seems that the fates of both companies are seemingly inextricably linked from this point forward.