Honda banks on hybrid vehicles until global infrastructure is ready for EVs: While Honda has committed to investing USD 40 bn to develop electric vehicles (EVs) over the next decade, the carmaker is banking on greater demand for hybrid vehicles in the near future, its chief executive Toshihiro Mibe said, reports the Financial Times. Honda was Japan’s first automaker to announce the phaseout of gasoline cars last April, but will transition to cars with a petrol-electric system, which will “be their strength” in 2030 or even 2035, Mibe said. The rationale is that infrastructure is not yet ready to support a full transition to EVs, with several factors still needed to be taken into consideration such as the living environment and the penetration rate of renewable energy, he said. Nonetheless, Honda announced that it will develop EVs in a JV with GM with production scheduled in 2027.

One of the main reasons EVs may have to wait: Obtaining batteries. Honda is still scrambling to set up viable supply chains to access EV batteries, an issue carmakers around the world are also facing. The Japanese manufacturer is moving away from in-house production and is instead looking to set up a JV to manufacture batteries or else find suppliers in the markets they operate in.

This comes as a dire lithium shortage is sparking questions on the sustainability of the global rise in EV manufacturing, as the West attempts to unfasten China’s control of the entire supply chain for lithium-ion batteries and EVs, battery manufacturers say, according to the Financial Times. Companies and governments abroad have fallen short of building sufficient supply chains for the white gold, making targets in EVs manufacturing unsustainable, chairman of Australian lithium producer Lake Resources said. But there are some efforts being made to replace China and build adequate supply chains, as Lake Resources builds a lithium production plant in Argentina. The plant, which owners hope will produce 50k tons of lithium carbonate annually by 2025, will use new technology developed by Bill Gates-backed US Company Lilac Solutions to extract lithium directly from brine, instead of traditional extraction methods.

Not helping matters: China’s lockdowns are threatening to exacerbate component shortages: A city-wide lockdown of Shanghai, which has now expanded to other parts of the country due to record surges in covid-19 cases, is leading to mass factory shutdowns and halting production of electronics, the Financial Times reports, citing researchers and economists. More than 30 Taiwanese electronics manufacturers have just today shut down factories close to Shanghai, with analysts saying that important components like printed circuit boards — used in almost every electronics gadget, including smartphone and laptop casings — would be affected most by the factory shutdowns. “Even if some companies are allowed to continue production, their utilization rates have fallen to between 40-60%. Raw materials can’t be moved in and finished products can’t be moved out,” one analyst said.

Fellow iSheep will remember that the lockdown has already hit Apple, with iPhone assembler Pegatron halting production at two of its plants in China.