Honda to electrify two-thirds of vehicles by 2030, executive says

By IM Staff
Published: Tuesday, 26 February 2019

Japanese carmaker Honda has set itself an ambitious target that hybrid electric vehicles will make up half of its output by 2030, while sourcing its raw materials responsibly and seeking transparency in the market for cobalt for use in batteries.

IM Staff

Carmaker Honda intends to power around two-thirds of the vehicles it produces by 2030 with electricity, an executive with the Japanese company has said.

The goal is part of the company’s electrification strategy, with around half of production to comprise hybrid electric vehicles (EVs), managing officer Noriya Kaihara said.

Zero-emissions vehicles, either battery electric vehicles or powered by fuel cells, will account for around 15% of output, with the remaining 35% having internal combustion engines.

"We’re aware our target is quite high," Kaihara said at the 25th Mining Indaba in Cape Town, South Africa. But he added that the company sees the target as achievable and will require increased quantities of battery materials, such as lithium, cobalt and nickel.

Honda has recognized the potential for carbon emissions reductions through the transition to EVs, he said, with the transportation sector currently the second-largest emitter of carbon, responsible for almost one-quarter of the global total.

"In order to give our customers confidence, we need to improve the performance of the electric vehicle," he said.

Ensuring that raw materials are sourced responsibly is essential, he said, adding that Honda believes this can be achieved via cooperation and collaboration between governments and stakeholders.

There have been concerns about the responsible sourcing of cobalt, with some mines allegedly using child labor or being in conflict zones.

"We expect the resources industry to establish stability in its business environment, as well as transparency and cooperation," Kaihara said.

Fastmarkets’ price assessment for standard-grade cobalt was $17.30-19.45 per lb on Wednesday February 13, down from $26.50-28.00 per lb at the end of December and a two-year low. The price was $22.40-22.90 per lb in February 2017.

Persistent selling pressure is dominating the spot market, with buyers minimizing their buying activity due to expectations that the metal price will continue to decline.