Honda Motor and General Motors are reportedly scrapping a plan to jointly develop affordable electric vehicles (EVs) less than a year after they agreed to work together in a $5 billion push to beat Tesla sales.
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Affording to Reuters, the decision underscores GM’s strategic shift to slow the launch of several EV models to focus on boosting profits as it grapples with rising costs.
“After extensive studies and analysis, we have come to a mutual decision to discontinue the program. Each company remains committed to affordability in the EV market,” the companies said in a joint statement.
Honda said there was no change in its plan to sell only electrified vehicles by 2040.
GM cited a joint statement that pointed to the projects the companies are still working on together in acknowledging the end of EV plan.
The two firms agreed in April last year to develop a series of lower-priced EVs based on a new joint platform, producing potentially millions of cars from 2027.
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The automakers had said the deal was for “affordable” EVs, including compact crossover vehicles, built using GM’s Ultium battery technology.
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