The new business will work out of Hitachi’s existing facility in Ibaraki
Japanese engineering giants Hitachi and Honda have formally signed an agreement to establish a joint venture to manufacture electric motors.
Hitachi’s Automotive Services unit and Honda Motor first announced the deal in February, and entered a joint agreement in March. As of July 3 Hitachi Automotive Electric Motor Systems was incorporated with a 5 billion yen (US$45 million) investment, and is 51% owned by Hitachi and 49% owned by Honda.
The unit will develop, manufacture and sell electric motors, based out of Hitachi’s premises in Hitachinaka-shi, Ibaraki Prefecture. The company will also receive a financial grant from the Prefecture as it has been recognized as a relevant project that “promotes the establishment of corporate head office functions.”
According to the a statement, “The new company will respond to the growing global demand from automakers for electric vehicle motors by developing competitive motors that combine the expertise of the two companies.”
“Producing motors is capital intensive, so rather than just manufacturing them for our own purposes, we would like to produce in large volumes with the possibility of supplying a variety of customers,” said Honda CEO Takahiro Hachigo at a press conference earlier this year.
Hitachi already supplies engine and brake components to Honda, as well as to Renault-Nissan, Toyota, Ford and Volkswagen, although it’s too early to tell if its new business will begin supplying these brands as well.