Honda wants to keep its hybrid vehicles affordable and is thus planning to use Toyota batteries made in North Carolina. The trade war between the United States and several other countries doesn’t have an end in sight. Automakers are changing some of their operations to keep in front of tariffs and resist having to raise prices.
Automakers Adjusting Across the Board
Honda isn’t the only automaker looking for ways to increase operations and avoid tariffs. Aside from making entire cars outside of the United States, various car parts are made in different countries and shipped to the US production plants. For example, hybrid batteries are a major component of hybrid vehicles. Honda may shift its operation by purchasing American-made batteries from Toyota to put in hybrids like the Civic, Accord, and CR-V.
While this change won’t have you finding new Hondas at a Toyota dealer, it will allow the automaker to get American-made batteries for its hybrid vehicles and keep the prices affordable. Starting this year, Honda plans to obtain enough Toyota batteries for about 400,000 vehicles, which should be plenty for all the hybrids it sells in the US.
This appears to coincide with Toyota’s plans to open its battery plant in North Carolina in April. The plant is expected to operate 14 battery production lines for EV models, hybrids, and plug-in hybrids.
Honda Wants To Keep Popular Models Affordable
Honda’s most popular models include the Civic, CR-V, and Accord. They’re also generally quite affordable as new cars. That means buyers would definitely notice any significant price increase thanks to tariffs. Even models made in the US could be subject to tariffs due to imported parts. Reports state that Honda could end up paying $4.7 billion per year because of reciprocal tariffs on Mexican and Canadian parts.
To minimize the effect of tariffs, Honda plans to move some of its production out of Canada and Mexico and into the United States. Earlier, it was reported that Honda was planning to keep its production of the Civic in Indiana to avoid tariffs. Honda and other foreign automakers are taking proactive steps to avoid major fallout from a prolonged trade war.
EV Industry Remains In Limbo
Overall, a lot is going on in the EV industry. Despite seeing record sales in recent years, the industry still remains in a sort of flux. While some want to view EVs as the future, there are still wrinkles to iron out. One of the biggest is how long it takes to charge one. It’s often hard for drivers of gas-powered cars to think about taking hours to recharge their EVs. China’s BYD claims to have solved that with a platform that can add nearly 250 miles of range in five minutes.
Obviously, it won’t happen immediately, not even in China, but it might prove the possibility exists. Meanwhile, the federal government is still likely to cut most of the incentives that yielded those record EV sales. That’s why many automakers are quickly shifting to making more hybrid vehicles as those continue to be in demand.
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