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: GM and Honda are setting their sights on making cheaper EVs

General Motors Co. and Honda Motor Co. are setting their sights on “affordable” electric vehicles, saying Tuesday they are expanding their collaboration.

The EVs would be built on a new architecture and use GM’s battery technology. The goal is to produce “millions” of EVs globally starting in 2027, including compact crossovers, the body style U.S. buyers have favored for years, the companies said.

GM
GM,
-3.69%

and Honda
HMC,
-3.04%

will work toward standardizing equipment and processes to get to “world-class quality, higher throughput and greater affordability,” they said.

Related: Tesla shows ‘solid’ sales, but COVID shutdowns may come back to haunt it, analysts say

The companies did not say how much they are investing in the new, expanded venture.

The two have collaborated before, including in an agreement to jointly develop two EVs expected to be available in 2024, and Honda has been an investor in GM’s autonomous-driving unit Cruise.

Auto makers have made strides in offering EVs in many styles and configurations, but they often carry a hefty price tag.

Developing an EV to match the price of some of the cheaper gasoline compact sedans at around $25,000 is viewed as crucial to aiding the shift toward mostly EVs on the roads.

Tesla Inc.
TSLA,
-3.71%

has been criticized recently for not offering a cheaper electric vehicle, as its sedan aimed at the masses, the Model 3, starts at about $40,000.

Newer EV makers such as Rivian Automotive Inc.
RIVN,
-7.51%

tend to focus on higher-end vehicles, with Rivian’s electric pickups and SUVs starting at around $70,000.

See also:‘It was never going to be easy’: Rivian is at a crossroads as it battles to win back Wall Street

GM has announced ambitious EV and sustainability goals, aiming to offer at least 30 all-electric models worldwide by 2025 and saying that 40% of the company’s vehicles available in the U.S. would be battery electric vehicles by the end of that year.

Shares of GM have lost 13% in the past 12 months, contrasting with gains of around 13% for the S&P 500 index.
SPX,
-0.52%

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