Honda: Lithium-Ion EV’s Won’t Reach Price Parity With Gasoline Cars

As Honda gears up for its debut Acura EV, the price tag that comes with existing battery technology and soaring battery metals costs suggests that ICE vehicles will maintain the cost-competitive edge for some time, Honda’s VP of sales for America told TheDrive.

Earlier this month, Ford CEO Jim Farley echoed these sentiments, saying that the cost of raw materials for the auto giant’s EVs would likely mean higher and higher costs for new models. 

“I don’t think there’s going to be much relief on lithium, cobalt and nickel anytime soon,” Farley told reporters at Ford’s Michigan Assembly Plant, as reported by CNBC.

Chinese battery-grade lithium carbonate prices have risen 90% since the beginning of the year, according to Benchmark, while cobalt and nickel have actually fallen. Lithium hydroxide prices have increased even more–up 127%. At the same time, automakers and battery gigafactories are still scrambling to line up future supply, and supply chain issues continue to haunt the segment. 

Honda’s answer to this dilemma is hedging on solid-state batteries, which require no lithium, as the only way to achieve eventual price parity with ICE vehicles.

"We [Honda] don't really believe that the current lithium-ion technology is the long-term solution." 

Solid-state batteries have higher energy density than their lithium-ion counterparts, which use liquid electrolyte solution and are thus at risk of exploding. 

Solid-state will likely be the “game-changer”, said Gardner, even though the technology is still in development.  

On Monday, Honda announced a $310-million investment into solid-state battery R&D, where it would test mass production of the batteries beginning in the spring of 2024. Honda will also team up with South Korean LG Energy Solutions to build a $4.4-billion battery plant in the U.S.

But until then, the auto giants themselves see price parity challenging, at best. 

By Charles Kennedy for Oilprice.com

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