Toronto, May 13, 2025 — Honda Motor Co. has announced a two-year delay in its ambitious $15 billion CAD (approximately $11 billion USD) electric vehicle (EV) investment project in Ontario, citing a slowdown in EV market demand and the impact of recent U.S. trade policies.
The project, initially unveiled in April 2024, aimed to establish a comprehensive EV supply chain in Canada, including a retooled vehicle assembly plant in Alliston, a nearby EV battery facility, and two additional battery component plants across the province. The initiative was expected to create 1,000 new jobs and secure 4,200 existing positions, with a production target of up to 240,000 vehicles annually by 2028.
Honda Canada’s spokesperson, Ken Chiu, stated that the company will “continue to evaluate the timing and project progression as market conditions change.” He emphasized that current operations and employment levels at the Alliston plant remain unaffected.
The delay also affects substantial governmental support, with both the federal government and the province of Ontario having pledged approximately $2.5 billion CAD (about $1.8 billion USD) each through tax credits and other incentives.
Industry analysts attribute the postponement to broader challenges in the EV sector, including cooling consumer demand and the financial strain from U.S. tariffs. Flavio Volpe, president of the Automotive Parts Manufacturers’ Association, noted that “the market cooling consequences of U.S. tariff actions continue to be felt by everyone, Honda included.”
Honda’s decision reflects a cautious approach amid shifting market dynamics and geopolitical factors, as the company continues to monitor conditions before proceeding with its EV expansion plans in Canada.
