Has Toyota now change into a battery provider? That is actually the plan, because it’s set to provide fellow Japanese automaker Honda with batteries to energy up round 400,000 of its hybrid vehicles offered within the U.S.
Toyota to Present Batteries for Honda Hybrids within the U.S.
Toyota, which has a brand new $14 billion battery plant in North Carolina, will start delivery batteries subsequent month, and it seems to be like Honda will probably be its first buyer. A recent Nikkei report reveals that starting in fiscal 2025, Toyota will provide batteries for roughly 400,000 Honda hybrids offered within the U.S.
At present, Honda makes use of batteries manufactured in China and Japan for the automobiles it sells within the U.S. Nevertheless, like extra corporations, it is making ready for modifications below Trump.
In 2024, EVs and hybrids accounted for over 1 / 4 of Honda’s electrified car gross sales within the U.S. To be extra exact, the Japanese automaker offered greater than 308,500 hybrids and 40,400 EVs within the U.S. in 2024.
Automakers Brace for Additional Tariff Rises
A ten % tariff on imports from China took impact within the U.S. earlier this month, on high of the ten % imposed in February. Tariffs are anticipated to rise even additional, and with a 25 % enhance in automobiles imported from Japan, automakers are being compelled to tighten up their provide chains.
A 25% tariff on Japanese automobiles, elevated from the present 2.5%, is anticipated to value the six main Japanese automakers round $20 billion within the U.S. Tariffs on imports from Mexico and Canada may end in an estimated $4.7 billion loss for Honda.
Partnering with Toyota to make use of its batteries for hybrids is a key a part of Japan’s broader technique to cut back reliance on China and different international locations for batteries and rising applied sciences. Toyota’s batteries will probably be used within the CR-V and different Honda hybrid fashions.
Toyota’s New U.S. Battery Plant Boosts Manufacturing Amid Tariff Challenges
The brand new Toyota Battery Manufacturing North Carolina (TBMC) plant spans over seven million sq. toes, roughly the scale of 121 soccer fields. As Toyota’s first in-house battery manufacturing facility exterior of Japan, it may play an important position as Trump’s tariffs take impact.
Partnering with Honda as a purchaser will assist Toyota scale back prices because it will increase manufacturing. Toyota goals to spice up electrified car (EV, PHEV, and hybrid) gross sales in North America from roughly 40 % final 12 months to 80 % by 2030.
How-To Geek’s Take
Trump’s tariffs are already creating chaos, with practically each automaker warning that they may push the U.S. additional behind. It is not simply abroad automakers feeling the stress, although.
The “Massive Three”—GM, Ford, and Jeep maker Stellantis—all manufacture automobiles in Canada and Mexico. In January, GM lowered manufacturing at its Mexican plant, the place the electrical Chevy Equinox, Blazer, and Honda Prologue are constructed. Final month, Stellantis paused operations at its Brampton Meeting Plant in Canada, the place the Jeep Compass EV manufacturing was slated to start.
Toyota’s $14 billion funding in U.S. battery manufacturing appears to be paying off. Now, the main focus shifts to introducing extra EVs. After unveiling three new electrical SUVs in Europe final week, together with an up to date bZ4X, Toyota hinted that extra fashions are coming to the U.S. quickly.
Sources: Electrek, Nikkei Asia