The investment is part of a strategic agreement between the two companies which will include joint development, stable battery supply and recycling.
CATL will provide new electric vehicle (NEV) batteries to Honda, mostly for use in its battery electric vehicles (BEVs).
The first Honda vehicle equipped with a CATL battery will be launched in the Chinese market in 2022, after which the partnership between the two companies will expand globally, they said.
Earlier this year, Honda announced that around two-thirds of the vehicles it produces by 2030 should be powered by electricity
, as part of the carmaker’s electrification strategy.
The agreement comes at a time when other carmakers are joining forces with EV battery makers while the shift toward electrification of mobility gains pace globally.
Earlier this month, Germany-based carmaker Mercedes-Benz agreed a strategic partnership with China-based battery cell maker Farasis Energy
, which included buying a 3% stake in the Chinese company.