Over recent years, Canadian governments pledged billions to attract electric vehicle (EV) production, positioning the country as a future EV manufacturing hub. However, several headline-making projects have encountered delays or cancellations.
Honda Canada, after announcing a \$15 billion investment in April 2024 to build four new EV plants in Alliston, Ontario, has now postponed the project for at least two years due to a slowdown in North American EV demand. This initiative included Canada’s first Honda EV assembly plant and a battery plant, aimed to create 1,000 new jobs and produce 240,000 vehicles annually by 2028.
Volkswagen’s \$7 billion EV battery plant in St. Thomas, Ontario, announced in 2023, also faces uncertainties. Promising up to 3,000 jobs and battery production for one million vehicles annually by 2027, this project is backed by up to \$16.3 billion in federal subsidies. The plant’s batteries are expected to supply U.S. assembly lines, potentially avoiding tariffs under the USMCA trade deal.
Swedish battery maker Northvolt declared bankruptcy in March 2025, jeopardizing its \$7 billion EV battery plant planned for Montreal’s South Shore. The project had significant financing from Quebec and federal governments but now faces an uncertain future as authorities seek new investors.
In Windsor, Ontario, the \$5 billion NextStar Energy battery plant for Stellantis vehicles is progressing slowly. Although construction halted briefly over government funding disputes, a new \$15 billion tax break deal has resumed work. Partial battery module assembly has started, with full production expected later this year.
Meanwhile, GM’s CAMI Assembly plant in Ingersoll, Ontario, which produces BrightDrop electric delivery vans, temporarily shut down in May 2025 due to low demand, planning a limited reopening in October. Sales in Canada and the U.S. have underperformed despite growing interest in electric delivery vehicles.
These developments highlight challenges in Canada’s EV strategy, including market demand fluctuations, U.S. tariffs, and infrastructure gaps. While government support remains strong, the pace of EV manufacturing growth is slower and more uncertain than initially projected.
Source: Swifteradio.com
