Honda's sedan strength, GM's truck might are set to unite.
The alliance would build on a partnership announced in April under which GM is helping to develop two new Honda EVs powered by GM's upcoming Ultium batteries.
A broad alliance could help push Honda further into the EV space and potentially add large SUVs and pickups to its lineup. For GM, the arrangement could create an inexpensive way to reenter the small-sedan segment it has abandoned and to continue selling a midsize sedan in a market increasingly tilted toward crossovers.
Honda said it expects to jointly develop gasoline, hybrid and electric vehicles, and it highlighted the sedan segment as having high potential. Honda has a lot to offer, based on its perennially popular Civic and Accord sedans.
"I think [GM] would like to still have some presence in that market," Abuelsamid said. "There is still some potential there, but not necessarily enough to justify developing their own new vehicle platforms or even retaining production capacity for that. They probably see this as a good opportunity to maintain a foothold in those segments with a comparatively low investment."
GM also has reduced investments in internal-combustion powertrains over the past few years, he said.
"Honda makes excellent internal-combustion powertrains. This gives them an opportunity to leverage Honda's strength to maintain a presence in that market, even at a reduced level that can still be profitable for both companies," Abuelsamid said.