General Motors and Hyundai signed a memorandum of understanding that could lead to the two automakers collaborating on green tech such as fuel-cell vehicles and EV battery manufacturing.

The non-binding memorandum announced Thursday is the first step toward a partnership between GM and Hyundai. The potential partnership would focus on using the automakers’ combined economies of scale to reduce costs, the companies emphasized.

“Potential collaboration projects center on co-development and production of passenger and commercial vehicles, internal combustion engines, and clean-energy, electric and hydrogen technologies,” the automakers said.

The two automakers will also “review new opportunities for combined sourcing” of battery raw materials, steel, and other raw materials. GM in 2022 said it had already secured enough battery raw materials to establish annual North American production capacity of 1 million EVs by 2025, although it has now backed away from that target after issues in ramping up its Ultium hardware.

2024 Chevrolet Equinox EV

This would be GM’s second major partnership with another automaker relevant to EVs. An existing partnership with Honda has seen GM manufacture the Ultium-based Acura ZDX and Honda Prologue electric SUVs for the Japanese automaker. GM and Honda in 2023 confirmed an early end to an affordable-EV partnership, aborting plans to make millions of EVs together. The two automakers also continue to partner on hydrogen fuel-cell tech.

Honda is now focusing on developing EVs in-house. It’s targeting 2 million annual EV sales by the end of the decade from a family of next-generation EVs dubbed the 0 Series, and it’s also partnering with Sony on the Afeela EV brand. That potentially leaves room for GM to bring in another automaker partner for future electrification plans.