Honda is adjusting its battery layout in the United States. The batteries that were intended to accompany the electric vehicle project are now being diverted to the data centre and to the fixed energy market. This change occurred about three months after Honda called for a partial United States electric car stop, and also reflects the repositioning of battery operations following a slowdown in United States electric vehicle demand.
The U.S. Electric Drive Program contracted.
Earlier, Honda had cancelled three electric vehicles for the United States market. As planned, the batteries required for these vehicles will be produced by a plant co-financed by Honda and LG Energy Solution in Ohio. Today, this portion of the battery is no longer a priority for passenger vehicles, but instead for energy storage.
The weak sales of electric vehicles in the United States was mentioned as one of the important contexts of Honda ' s adjustment. With the removal of the related tax incentives, Republican policy support for the promotion of United States electric car and battery production has diminished. Some consumers had previously purchased cars in advance to complete their transactions before the tax benefits were closed, which further depressed their subsequent sales performance.
Reserve markets are growing faster.
Honda did not terminate the joint venture arrangement with LG Energy Solution, while constricting the motor vehicle scheme, opting instead to retain battery manufacturing capacity and to seek new demand for exports. Fixed storage can thus become a more realistic direction.
According to SEIA and Benchmark Minerals, the United States fixed energy market continues to expand rapidly. In the first quarter of this year, the new installation of the storage system reached 9.7 giva, an increase of 32 per cent over the same period. Based on the reported conversions, this size is roughly equivalent to the amount of batteries required to manufacture approximately 120,000 electric vehicles.
Data centres as a source of new demand
By the end of the decade, the report projected that the additional storage capacity would reach 110 giva per year, which was close to three times the current size. As battery prices recede, storage energy systems are being used more for grid regulation and are being integrated with wind and photovoltaic projects to improve power stability.
Data centres have become one of the key applications for fixed batteries. As computing facilities expand, the demand for back-up power and energy-regulating capabilities continues to rise, and the commercial value of battery systems increases.
It was also reported that Tesla currently holds a large share of the market, with Māori in Megapack and Powerwall at about 30 per cent, about twice the profit margin of the car business. This also suggests that for many companies, batteries are becoming independent in themselves and not just part of the supply chain for electric vehicles.