Japanese giants Honda Motor Co. Ltd and Hitachi Automotive Systems Ltd. have signed a 'memorandum of understanding' to start a joint venture that will focus on providing motors for electric vehicles.
The joint venture company under the two manufacturers will be responsible for the development, manufacturing and sales of electric motors. The electric motors will be employed in hybrid vehicles and fully electric cars.
The unnamed joint venture will be based in Hitachinaka City in the Ibaraki Prefecture, Japan. Both Honda and Hitachi will invest around $44.5 million and they hope to finalise the deal by March 2017.
The new company will have subsidiaries in China and the United States. Both the facilities will have development, sales and production capabilities. The main aim of this joint venture is to offer electric vehicles and components at a competitive price.
Honda has spent the last 10 years sampling the products of several electric vehicle startups and among them, most notable in the two-wheeled space being the Mission Motors. Now the firm is not functioning, but, the electric motors made the company powered the Team Mugen Shinden electric motorcycle at the Isle of Man TT.