Honda Motor is reportedly set to indefinitely halt the development of its $15 billion electric vehicle complex in Canada, as per various reports from Japanese media. The Japanese automaker had previously paused the project in Alliston, Ontario in May last year, citing a need to assess the EV market for two years before making a decision on its future.
The decision to freeze the Canadian EV investment is attributed to sluggish demand for EVs in the U.S., with Honda now prioritizing hybrids as the focal point of its North American strategy. While Honda Canada has not confirmed the news, both provincial and federal officials have stated they are in regular communication with the company but did not confirm awareness of the decision.
Initially announced in 2024, the project was slated to include a vehicle assembly plant and battery production facilities, with substantial federal and provincial funding support. Ontario Economic Development Minister Vic Fedeli emphasized that public funds would only be allocated to Honda if the project proceeded, underscoring Honda’s commitment to Canada amid challenges in the auto sector.
Despite headwinds in the industry, including U.S. tariffs and global uncertainties, Honda’s long-standing presence in Ontario signifies a sustained dedication to the region, as highlighted by Fedeli. Prime Minister Mark Carney acknowledged industry challenges and ongoing support for companies, without specific mention of Honda’s situation.
In response to the reported decision by Honda, federal Industry Minister Mélanie Joly’s spokesperson, Gabrielle Landry, noted the evolving landscape in the automotive sector globally and in North America. Landry highlighted the impact of American tariffs and policy changes on automakers, leading to delays or adjustments in EV and battery projects.
The reported halt in Honda’s development is part of a trend of stalled EV projects in Canada, mirroring similar actions in the industry. General Motors ceased BrightDrop electric van production, Ford Motor Co. shifted focus from EVs to pickup trucks, and various battery-related plants were put on hold.
Conservative MP Adam Chambers criticized the government’s EV policy, suggesting a reevaluation was necessary to secure access to the U.S. market for the Canadian auto industry’s sustainability. Despite challenges, Honda remains a significant player in Canada’s automotive manufacturing, producing a substantial number of vehicles last year, including gas and hybrid models of popular vehicles like the Civic and CR-V.