Honda And GM Abandon $5,000,000,000 Plan To Co-Develop Affordable EVs

[REUTERS/Rebecca Cook]

Alexander Pease Contributor
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Automotive titans Honda and General Motors (GM) are tossing out what would have been a multi-billion-dollar joint plan to co-develop affordably priced electric vehicles (EVs) as of Wednesday.

The initial goal the automakers had in mind was to surpass Tesla in EV sales, Reuters reported. But now the companies are officially pumping the brakes on the now-scrapped $5 billion idea.

“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,” the companies announced in a joint statement, according to Reuters. (RELATED: ‘Not Ready For Primetime’: EV Proponents Keep Going On Road Trips And Proving A Point, Just Not The One They Expected)

Both companies assured the public they will continue to invest in EV productions, but on their own accord, per Reuters.

The companies shared their plans to join forces last April, with a vision to “develop a series of lower-priced EVs on a new joint platform,” the outlet noted. This would have included compact cross-over vehicles powered by GM’s Ultium battery technology. (RELATED: It Will Be Years Before EVs Are As Affordable As Gas-Powered Vehicles, Auto Exec Says)

“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,” Honda CEO Toshihiro Mibe explained in an interview with Bloomberg, per Reuters.

The move is in line with GM’s latest steps to delay the debut of multiple of its EV models. The American automaker is currently dealing with the costs of the ongoing United Auto Workers (UAW) strikes. (RELATED: Ford Pauses Construction Of Key EV Battery Plant)

The UAW strikes have reportedly cost GM some $200 million each week of October, according to the outlet.

Despite the joint effort with GM now being a no go, Honda still plans to completely electrify its lineup by 2040, Reuters noted.