Honda and Sony close partnership to produce electric cars focused on mobility services

Technology leader Sony and automaker Honda signed a "memorandum of understanding" on Friday, 4, which determines that the two Japanese giants form a new company to manufacture electric cars with a focus on urban mobility services.  

What happens when an automaker like Honda teams up with a tech company like Sony to create a new brand of electric cars? The world may find out in the not-so-distant future, as the two industry giants announced on Friday (04) that they will work together to develop and sell new electric vehicles with a focus on mobility services.

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Official company announcement

While Honda and Sony are still negotiating the details of such a partnership, they said in a joint statementto that the goal is to create the new company within a year. The ambitious plan also includes selling the newly formed brand's first electric car model by 2025, with further plans to market and provide mobility services.

The new company has yet to be named, but the business plan is for it to handle the design, development, planning and sales aspects. However, Honda will be in charge of manufacturing the vehicles using its facilities. Sony will be responsible for building the platform for the mobility service.

"While Sony and Honda are companies that share many historical and cultural similarities, our areas of technological expertise are very different," Honda Motor CEO Toshihiro Mibe said in a statement on Friday.

Honda wants to sell only electric and hydrogen cars by 2040

Honda said last year that it is committed to selling only battery electric and hydrogen fuel cell vehicles by 2040. The gradual increase in these types of vehicles over the next two decades will coincide with declining production and the eventual elimination of automaker's internal combustion.

The first two of the brand's new electric models - created in partnership with GM and not part of the Sony team - are expected to hit the market from 2024, one being the Honda Prologue and the other part of Acura's premium.

In the companies' joint announcement, Sony showed off its Vision-S 02 electric crossover prototype from the CES tech show. This, plus an earlier Vision-S01 electric sedan, had already indicated Sony's intention to enter the EV market at some level.

Partnership with Japanese companies signal a 'boom' in the electric car market

Toyota, for example, is partnering with rivals in its region, such as Subaru, Mazda and Suzuki to jointly develop an electric car chassis and focus on a combustion engine-only division – an agreement that allows it to share the cost. Meanwhile, Toyota CEO Akio Toyoda personally revealed plans in December to bring 30 electric vehicle models to market by 2030.

“Honda has been the slowest of all when it comes to supporting electric cars and mobility, in part because they never saw the need to invest in what is still, for many in the industry, an unprofitable segment,” said Schmidt, electrical specialist, told Fortune magazine.