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Honda Begins Battery Production for Energy Storage Systems
Honda started making batteries for stationary storage this week after canceling U.S. EV programs three months earlier. The move keeps its joint venture with LG Energy Solution intact while the storage market expands rapidly.
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Honda began production of batteries for energy storage systems this week, TechCrunch reported. The cells will go to data centers and grid projects rather than the electric vehicles the company had planned for the U.S. market.
Three months earlier Honda canceled three EV programs intended for the United States. Those vehicles were to use cells from the Ohio factory operated by its joint venture with LG Energy Solution. Honda did not dissolve the venture and is now directing the output to stationary storage.
The company recorded a $15.7 billion write-down in its last fiscal year tied to the EV restructuring and weaker results in China. Demand for U.S. EVs had softened after federal tax credits ended in September.
The stationary storage market grew 32 percent year over year, according to SEIA and Benchmark Minerals. Installations reached 9.7 gigawatt-hours in the first quarter, a volume equivalent to roughly 120,000 electric vehicles. The same report projects annual installations will reach 110 gigawatt-hours by the end of the decade.
Tesla earns 30 percent gross margins on its Megapacks and Powerwalls, about double its vehicle margin. Many stationary batteries are installed at data centers while others connect directly to the grid to support wind and solar output.
