Honda's global electrification strategy is actually a transformation strategy. That is, to take advantage of the new wind direction emerging in the industry, to attract investment, to achieve the company's business transformation with the trend, and to achieve new profitability and survival methods.
Author 丨Zice
Edited 丨tian grass
Produced 丨 Automan Media
From 2021 to 2022, Honda deploys a global electrification strategy as if pressing the "fast-forward button."
1
The center of gravity of the series changes
In October 2021, Honda China's "Electrification Strategy Conference" actually gave a "strategic framework". In addition to a few timelines, a rough partnership strategy was identified, and a rough product plan was also proposed, but details were lacking.
Aside from the vision, it was more like a brand + product launch. Pure electric brand e:N unveiled, and 3 concept cars were launched at the same time. Consistent with their pragmatic style, GAC Honda and Dongfeng Honda will mass-produce one of these cars in 2022.
Many people are more impressed with the e:N product, but are less aware of the strategic planning.
From this perspective, the e:N brand night on April 25, 2022 is a strategic response to the mass production of electrified models in 2021.
Katsushi Inoue, Executive Executive Director of Honda, Director of Honda China and General Manager of Honda Giken Industries (China) Investment Co., Ltd., said: "As the first mass production model of the e:N brand, the two sister models of Dongfeng Honda e:N1 and GAC Honda e:NP1 are specially tailored for the Chinese market. At the same time, he also revealed that these two cars, at the beginning of the development of the needs of Chinese consumers, and developed by Honda China's engineers.
This is also equivalent to the implementation of Honda's global electrification strategy, and the Chinese market, human resources and supply chain must play an important role.
In the past, the common practice of multinational car companies was that international models were brought to China and "localized improvements" were carried out by local research and development institutions.
Although both take into account the consumption preferences of the localized market and both take advantage of local talent, one is a strategic layout and the other is a "tactical adaptation", and the two are not the same.
Two weeks before that, on April 13, Honda gave a detailed explanation of its global electrification strategy. The strategy moves from a framework conception to a practical process. This time, it is the real strategic layout planning.
The goal is reiterated, that is, in the next 10 years, Honda will invest 8 trillion yen (about 405.2 billion yuan) in research and development funds to keep up with the historical trend of the automotive industry, and by 2030, it will launch 30 pure electric vehicles in the global market, with an annual output of more than 2 million vehicles.
2
Localization and local cooperation
In line with this, Honda will strengthen its localization strategy. In the United States, it jointly purchased batteries with General Motors; in China, it formed a long-term supply relationship with CATL; in Japan, it cooperated with Nissan to select AESC Vision as a supplier.
After the Toyota camp allied with Panasonic, Honda actually had no choice in the local area. Panasonic does not exclude one more customer, but Honda deliberately distances itself from Toyota.
Compared with Toyota Electrification, Honda emphasizes cooperation.
In the past, Honda's fuel models were developed locally and brought to China and the United States (except acura).
Under honda's new CEO Toshihiro Mibe's rather "radical" electrification strategy, Honda has designed different electrification development routes for its three major markets - North America, China, and Japan, and will enter the market with different products.
The e:N brand is currently exclusive to the Chinese market; in the Japanese market, Honda is entering with small electric vehicle products. In the second phase (from 2026), the electric platform of the "Honda e: Architecture" structure will come out to pick the beams.
In addition to a strategic partnership with GM in the United States, Honda and battery research and development company SES signed a lithium-metal battery development cooperation agreement in January, and in March, Honda and Sony reached a cooperation to develop "high value-added" electric vehicles while seeking to provide mobility services.
At present, Honda has built a new energy production line in Wuhan and is doing the same in Guangzhou. The same plan is also being planned in North America, but it has not yet begun to be implemented. Honda's China plan is once again ahead of the curve.
The e:N brand is the expression of Honda's electrification strategy after localization in China. If implemented successfully, it will be rapidly rolled out to North America. At the same time, it also shows that Honda is under less pressure to compete in electrification in North America.
3
The layout will be completed in 2026
Why is the large-scale electrification process only starting in 2025-2030? Honda did not explain why.
However, honda's "technical research" name itself may reveal a little idea, that is, Honda's strategy and technical orientation have a lot to do. Honda may believe that in two or three years, solid-state batteries can move from the laboratory to the production line, and the three major problems of electric vehicle endurance, safety and energy replenishment are expected to be "structurally" solved.
Moreover, this period should be the period of global electric vehicle popularization. "Popularization" means that the penetration rate reaches 50%, that is, consumers are not forced to consider electric vehicles because of policies and restrictions when buying cars. The competitiveness of electric vehicles can also gain an advantage without the help of external forces.
According to the rapid development of the new energy industry today, China may realize this day a little earlier. The focus of R&D and production on China (the pilot production phase is speculated to be local) is logical.
Honda, like other Japanese companies, has been criticized for not being active enough in its electric strategy, and some public opinion has also made up some "sudden enlightenment" and "catch-up" dramas.
There is no controversy about how fast or slow to start, but the reason is not conservative, but because any industrial transformation decision must be based on its own profitability and business status.
Honda's fuel vehicle business is still making a lot of profits, and it is irrational to give up immediately. The current implementation of phased transformation, focusing on achieving full deployment after 2025, focuses on the rhythm in their own hands.
In 2026, Honda will begin to adopt a combination of soft and hard EV platforms (Honda e: Architecture). Through its alliance with General Motors, Honda plans to launch affordable electric vehicles (around 1 million yen) in 2027, which will be as competitive in cost and range as gasoline-powered vehicles, a program that will start from both North America and Japan.
By 2030, Honda plans to launch 30 EV models worldwide, covering a complete lineup from commercial micro-electric vehicles to flagship models.
Currently, in the North American market, Honda is purchasing GM's Aoteneng platform batteries and is studying the establishment of a battery production joint venture.
In 2024, Honda will work with General Motors to develop two medium- and large-sized EV models (Honda and Acura SUVs, respectively).
In China, Honda plans to launch 10 new EV models by 2027. The pace can't be said to be fast, but the Honda style has always been like this.
Honda doesn't seem to tolerate the failure of a first-generation car series, and is always more interested in going deep into a model than developing a bunch of product matrices horizontally. Honda has always considered itself a "small and medium-sized company" and does not need to be as comprehensive as Toyota, but is committed to developing a long-lasting product line.
To put it bluntly, money is spent on the cutting edge and waste caused by decision-making mistakes is eliminated.
4
Solid-state batteries and vehicle platforms
However, in fact, Honda also has a similar choice with Toyota, that is, to develop its own all-solid-state battery, and clearly start the trial production process in the first quarter of 2024.
The first model equipped with an all-solid-state battery is scheduled to be launched "within one or two years before 2030", and Honda will invest 43 billion yen (about 2.18 billion yuan) to achieve this.
It needs to be clear that battery trial production is not equal to formal production, and small-scale trial production is generally about one year away from formal mass production, especially for battery solutions that have not yet matured in this technology.
Assuming that solid-state batteries are officially put into production in the first half of 2025, if this schedule is followed, the relevant models will be launched in 2028-2029, and the time is actually very tight.
For Honda, a new dedicated electric platform, known as the "Honda e: Architecture", will be available in 2025-2030. The relevant models and platforms must be "seamlessly connected" to successfully implement Honda's electrification strategy.
The new electric platform + solid-state battery is one of the cornerstones of Honda's global strategy.
Given that Toyota has postponed the start of solid-state batteries (Toyota's planned time is vague), there is uncertainty about whether Honda can take the lead in completing it. However, Honda still planned the time node to complete each step quite carefully, leaving no way back for itself, which seems to be very unconventional.
5
"Digital Capabilities"
As another cornerstone of its electrification strategy, Honda will continue to advance the development of connected technologies and software, which can be summarized as "digital capabilities.".
Honda expects that with enough digital capabilities, it will be able to interconnect products, create "chemical reactions", and connect electrified digital terminals and the energy and information stored in products with users and society. Honda will build a cross-domain interconnection platform and seek cross-industry cooperation and alliances to invest in start-ups.
Of the 8 trillion yen invested in the entire electrification strategy, it is expected to invest about 5 trillion yen in electrification and software (R&D expenses of about 3.5 trillion yen, investment of about 1.5 trillion yen). In addition to the 8 trillion yen investment, Honda plans to invest about 1 trillion yen over the next 10 years to "prepare for future growth", including "new fields" and "resource recycling".
This shows that at the planning stage, Honda intends to build a resource recycling system and "open" tracking of new technologies, that is, to maintain sensitivity to technologies that have not yet emerged.
In this way, Honda has transformed into a new energy + digital technology + investment company, which has fundamentally changed compared with the current business scope and operation mode.
Therefore, Honda's global electrification strategy is actually a transformation strategy. That is, to take advantage of the new wind direction emerging in the industry, to attract investment, to achieve the company's business transformation with the trend, and to achieve new profitability and survival methods.
The essence of Honda's strategy is serious thinking about its own destiny. Not only products and businesses must be transformed, but also ways of living, with the aim of adapting to the future. The future itself is uncertain, so what Honda wants to grasp as accurately as possible is before 2030.
The electrification strategy's dayly investment builds honda's earnings expectations in the U.S. and American markets. It seems that Honda is confident that it can continue to maintain large-scale investment for 8 years.
If this plan is implemented step by step, Honda's conservative remarks will be put to rest. Within the scope of strategic focus, Honda basically has an attitude of "shooting all bullets".
At present, the construction of two new energy factories with Chinese partners indicates that capital investment and strategic implementation have begun. Testing their effectiveness will not have to wait until 2030. According to the plan, 2026 can see the full picture of Honda's electrification strategy becoming a reality.
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