Honda Motor is reportedly planning to definitively halt the development of its $15 billion electric vehicle complex in Canada, as per multiple reports from Japanese media sources. The automaker had paused the Alliston, Ont., project development in May last year, citing a need to assess the EV market’s trajectory over a two-year period before committing further. Sluggish demand for electric vehicles in the U.S. has led Honda to pivot its focus towards hybrid vehicles as the core of its North American strategy.
While Honda Canada refrained from confirming the news, provincial and federal officials stated they are in consistent communication with Honda, although they did not confirm being informed of the decision. The project, announced in 2024, was planned to feature 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.
Honda’s long-standing presence in Ontario was highlighted by Fedeli, emphasizing the company’s commitment to the region. Prime Minister Mark Carney acknowledged industry challenges, particularly referencing U.S. tariffs impacting the auto sector. The government is dedicated to supporting companies within the sector to navigate challenges and secure beneficial deals for Canada.
The decision by Honda to suspend development aligns with a trend of stalled EV projects in Canada, with General Motors discontinuing BrightDrop electric van production and Ford Motor Co. shifting focus to pickup trucks. Conservative MP Adam Chambers critiqued the government’s EV policy, advocating for a strategic shift towards securing access to the U.S. vehicle market to safeguard the Canadian auto industry’s future. Honda’s production output in Canada in the previous year exceeded 400,000 vehicles, positioning it as the second-largest manufacturer after Toyota, encompassing both traditional gas and hybrid models of Civic and CR-V vehicles.