Billion-Dollar Electric Vehicle Plant Slated For Ohio Thanks To Biden Bill
Car manufacturer Honda and electronics conglomerate LG announced plans to build a $4.4 billion facility for electric vehicle battery production in Ohio on August 29. The announcement comes two weeks after the Inflation Reduction Act, which contains incentives for consumers to buy electric vehicles with American-made components such as batteries, was signed into law by President Joe Biden on Aug. 15.
The two multinational companies expect the facility's construction to begin in 2023, with the plant ready to commence production by 2025. It is the first investment announced by Honda toward producing their own batteries since the company said it would go all-electric by 2040.
Honda’s CEO Toshihiro Mibe noted in the company's statement that “Honda is committed to the local procurement of EV batteries which is a critical component of EVs. This initiative in the U.S. with LGES [LG Energy Solution Ltd.], the leading global battery manufacturer, will be part of such a Honda approach.”
The production of a majority of electric vehicle batteries currently in use occurs in China, but Biden has enacted multiple policies to encourage shifting production to the United States and create jobs for American workers. In a March 29 statement, the White House said its efforts “to build a clean energy economy are driving companies to make more in America rebuild our supply chains here at home, and ultimately bring down costs for the American people.”
The Inflation Reduction Act passed Congress with only Democratic votes in the face of uniform Republican opposition in the House and Senate. Vice President Kamala Harris advanced the law with a tiebreaking vote in the Senate, and it was later signed by President Joe Biden.
As part of the Inflation Reduction Act's $369 billion in funding focused on clean energy and reducing climate change, there is a subsidy for car buyers of $7,500 on electric vehicles. The law requires that qualifying vehicles are largely assembled in the U.S. with components made in America, and phasing out previous credits that didn't require U.S.-based production. Provisions for incentives were also included for companies like Honda so they can continue to compete in the U.S. market, and other carmakers such as Tesla, GM, and Ford have cars on the market that will already qualify for new credits.
Additionally, the Infrastructure Investment and Jobs Act, which Biden signed into law in November 2021, has $3.1 billion in subsidies for companies who choose to build electric vehicle-related facilities domestically.
Multiple companies have announced plans to build production facilities in the U.S. since both laws passed and other policies championed by President Biden went into effect, planning billions in investments and thousands of new jobs in multiple states around the country.
In May, Stellantis and Samsung SDI announced that together they would spend $2.5 billion to build a battery production plant in Kokomo, Indiana. The companies stated the facility is projected to create 1,400 new jobs in the area. That same month, Hyundai said that they would be building a $6.5 billion EV factory outside of Savannah, Georgia, which they project would create 8,100 jobs for the state.
Reprinted with permission from American Independent.
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