Asahi Kasei Builds Factory in Canada, Expected to Create 300 Jobs; Honda Invests $300 Million

On November 18, 2024, the official website of Asahi Kasei announced that Asahi Kasei Battery Separator Company started the construction of a new lithium-ion battery separator manufacturing plant in Port Colport, Ontario, Canada, and held a groundbreaking ceremony on November 14.

The ceremony was attended by numerous government officials, Asahi Kasei and senior Honda executives. The plant is expected to create more than 300 full-time jobs in its first phase and plans to produce about 700 million square meters of coated lithium-ion battery diaphragms per year.

The plant is expected to start commercial production in 2027, subject to regulatory approvals.

Asahi Kasei has started to recruit staff locally, and five employees are currently involved in the start-up phase of the project. In September, the company held a community Open house at Vale Health & Wellness Centre in Port Colborne to provide a platform for the local community to learn more about the project and upcoming job opportunities. In addition, Asahi Kasei has begun working with provincial companies and contractors on civil works.

Asahi Kasei's joint venture with Honda

Asahi Kasei and Honda jointly announced on November 1 that they have signed a shareholder agreement to transform E-Materials Canada Corporation (E-Materials), a wholly owned subsidiary of Asahi Kasei's Canadian subsidiary, into a joint venture between Asahi Kasei and Honda. It will be renamed Asahi Kasei Honda Battery Separator Co., LTD. (tentative name) and is expected to be established and begin operations in early 2025.

The agreement is based on Honda Canada Inc., a subsidiary of Honda Canada, acquiring 25 percent of the shares by subscribing to the new shares issued by E-Materials through a third-party placement.

Honda will make a total of about $300 million in new shares and other investments in the joint venture, with Asahi Kasei holding 75 percent and Honda 25 percent.

The agreement is the result of further discussions between the two companies on cooperation in the production of lithium-ion battery diaphragms in Canada, building on the basic agreement announced on April 25, 2024.

The two companies will combine their respective strengths in high value-added material technology and electrification technology to produce high-quality diaphragms for lithium-ion batteries to accelerate the realization of high-performance electric vehicles.

Coated lithium-ion battery separator

The coated lithium-ion battery separator is a key component of the battery, which prevents direct contact between the positive and negative electrodes, avoids short circuits, and allows lithium ions to pass through to store energy. The project is expected to enter the visible construction phase in the coming months, including structural development and utility connectivity to support the building.

Koshiro Kudo, President and representative Director of Asahi Kasei Corporation, said: "The construction of this plant marks an important step in our efforts to advance innovation in battery technology. Our establishment of a center of excellence in Port Colborne will further solidify Asei's leading position in meeting the growing demand for electric vehicle battery diaphragms in North America and driving the energy transition through cutting-edge technology."

The Port Colborne plant will be the first large-scale wet diaphragm plant in Canada, enhancing Asahi Kasahi's energy storage business and supporting its growth strategy. Battery diaphragms play a crucial role in lithium-ion batteries, improving energy density and long-term durability, which is critical for electric vehicles and other energy storage applications.