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Mazda in US$10.6bil EV plan with China-owned battery maker
Published on: Tuesday, November 22, 2022
By: Nikkei, FMT
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Mazda is one of many global automakers competing to expand EV capacity. (Daniel Fernandez pic)
TOKYO: Japanese automaker Mazda plans to spend about ¥1.5 trillion (US$10.6 billion) by 2030 to address its transition to electric vehicles, joining a rush by global carmakers to expand EV capacity.

The company will team up with Kanagawa-based Envision AESC Group, a major auto battery manufacturer owned by a Chinese company, to secure batteries and increase EV production at its plants in Japan, according to sources familiar with Mazda’s plans.

Mazda follows other carmakers including Toyota Motor in announcing a series of big investments in EVs, with batteries a key focus because of their importance. Batteries account for about 30% of EV production costs.

The automaker will source EV batteries from Envision AESC along with Toyota-affiliate Prime Planet Energy & Solutions.

Envision AESC has also received investment from Nissan Motor.

Mazda is expected to spend several hundred billion yen on battery procurement by 2030 as it tries to reduce fixed costs through external purchases.

The company also plans to collaborate with Japanese electronics group ROHM on semiconductors for components used in EV drive units.

Mazda will increase development of EV-specific vehicle bodies and the e-axle – a drive unit that corresponds to the engine of a conventional car – to launch EVs in earnest in the latter half of the 2020s.

The automaker will produce EVs at its main plant in Hiroshima Prefecture and export them to the US and other countries. The company now expects EVs to make up 30% to 40% of all production by 2030, compared with a previous target of 25%.

Mazda has an established reputation for its internal combustion engine technology, including mass production of the world’s first rotary engine. It will drastically reduce new investment in gasoline and diesel vehicles, and shift from internal combustion to electric vehicles such as EVs and plug-in hybrids.

The company plans to announce its business plan through 2030 on Nov 22.

Toyota will invest ¥4 trillion in EVs, batteries and other products between 2022 and 2030. Honda plans to spend ¥5 trillion on electrification and software by fiscal 2030. Other global players are also investing in EVs, including in battery factories.