GM And Honda Scrap Plans To Build Affordable EVs Together


General Motors (GM) and its long-time partner Honda have decided to discontinue their joint project to build millions of affordable electric vehicles (EVs). The decision was made in light of challenges posed by high interest rates, rising battery costs, and a softening demand for EVs.

Key Takeaway

General Motors and Honda have decided to discontinue their collaboration on building affordable EVs. Despite this setback, GM remains committed to offering lower cost EVs and plans to develop a next-generation Chevrolet Bolt EV. The companies are shifting their focus to autonomous vehicles and have announced plans for a robotaxi service in Japan.

A Shift in Strategy

GM and Honda had announced their partnership 18 months ago with the aim of co-developing affordable EVs using GM’s Ultium EV platform and the manufacturing capabilities of both companies. The goal was to introduce these vehicles, priced under $30,000, to the North American market by 2027.

However, following extensive analysis, both automakers have mutually agreed to discontinue the program. GM spokesperson Darryll Harrison stated, “GM’s focus over the next two years will continue to be on scaling the Ultium Platform and battery cell capacity, expanding a robust domestic EV supply chain, and delivering a comprehensive portfolio of EVs across categories, including lower cost models.”

A Commitment to Affordability

Despite this setback, GM remains committed to offering lower cost EVs in the market. The automaker recently reversed its decision to discontinue the Chevy Bolt EV and plans to develop a next-generation version of the popular affordable EV hatchback.

During the company’s third-quarter earnings call, CEO and Chair Mary Barra emphasized the significance of the next-generation Chevrolet Bolt EV and the strategic value of leveraging the strong equity associated with the brand. Barra stated, “Our strategy is to build on the tremendous equity we have in the brand and to do it as efficiently as possible.”

A Shift in Focus

While the collaboration on affordable EVs has come to an end, GM and Honda continue to deepen their partnership in autonomous vehicles. Both companies are working together through GM’s self-driving car subsidiary, Cruise, and have previously collaborated on projects such as the Honda Prologue and Acura’s first EV. They recently announced plans to launch a robotaxi service in Japan under a new joint venture. The service, slated to begin in early 2026, will feature Cruise Origin vehicles and expand beyond central Tokyo.

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