Accelerating the Investment in Mobility Innovation
General Motors and Honda have recently signed a deal to share vehicle platforms and technology in North America starting next year. Both the giant automakers signed a memorandum of understanding to establish a North American automotive alliance. The proposed alliance will include sharing a range of vehicles, to be sold under each company’s distinct brands, as well as cooperation in purchasing, research and development, and connected services.
Both the companies plan to collaborate on purchasing supplies by leveraging their scale to gain cost savings. The purchasing collaboration will focus on joint sourcing of materials, logistics, and localization strategies. This alliance will help GM and Honda achieve substantial cost savings and allow them to invest in developing future products. “Given our strong track record of collaboration, the companies would realize significant synergies in the development of today’s vehicle portfolio,” said Mark Reuss, the President of General motors.
Combining the R&D Efforts
As part of the deal, both General Motors and Honda would share R&D and engineering costs for certain future co-developed vehicles and propulsion platforms. Moreover, with the shifting consumer needs and regulatory requirements, introducing advanced technology is imperative. Thus, GM said the alliance would study “combining the R&D efforts between the two companies related to advanced technology areas, including electrical architecture, advanced driver assist systems, infotainment, connectivity, and vehicle-to-everything communication.”
A Long-lived Partnership
The GM-Honda relationship began two decades ago and includes recent collaborations on fuel cells, batteries, and the Cruise Origin shared autonomous vehicle. In April, both the companies signed an agreement to jointly develop two all-new electric vehicles for Honda. Those vehicles will be on GM’s global EV platform powered by proprietary Ultium batteries, but Honda will design the vehicle exteriors and interiors. Alongside, under the latest proposed alliance, both companies will share common vehicle platforms including both electrified and internal combustion propulsion systems that align with the vehicle platforms. The co-development planning discussions about the same will begin immediately, while the engineering work will begin in early 2021.