TORONTO — Honda Canada is putting the brakes on its $15-billion electric vehicle investment in Ontario, which includes a planned EV battery plant and a revamped vehicle assembly facility.
Spokesman Ken Chiu cited a recent downturn in the EV market as the reason for the delay, stating that Honda will postpone the major investment by about two years.
Honda Canada is postponing its $15-billion electric vehicle project in Ontario, citing shifting market conditions. Spokesperson Jennifer Chiu said the company will continue to assess the project’s timing and development as circumstances evolve, but emphasized that the decision does not affect current jobs at its Alliston, Ontario plant.
The ambitious plan, unveiled in April 2024 with backing from both federal and provincial governments, includes an upgraded assembly plant, a new EV battery facility, and two battery component plants across Ontario. Once completed, the project was projected to generate 1,000 new jobs while retaining 4,200 existing roles, with full production capacity aimed at 240,000 vehicles annually by 2028.
The federal and Ontario governments had each pledged up to $2.5 billion in support through tax credits and other measures. Ontario Economic Development Minister Vic Fedeli confirmed ongoing talks with Honda and reaffirmed the company’s long-term commitment to the province’s auto sector.
The announcement comes amid financial headwinds for Honda. The automaker reported a 24.5% drop in annual profit and warned of further losses tied to anticipated tariffs under a potential second Trump administration. Honda executives noted that tariffs on Canadian and Mexican-made vehicles could significantly impact operations and are prompting a strategic review, including shifting more production to the U.S.
Despite uncertainties, Honda leadership says it remains focused on adapting and protecting its long-term investment plans.