Honda Canada is delaying its $15-billion electric vehicle investment in Ontario by two years, citing a cooling EV market and global economic uncertainty. The announcement comes just one year after the automaker unveiled plans to build a complete EV supply chain in Alliston, Ont., including a new battery plant and a retooled vehicle assembly facility.
Honda spokesperson Ken Chiu confirmed the project will be paused until at least 2026 but emphasized the decision won’t affect current employment or production at the Alliston site. The company remains committed to evaluating market conditions before resuming progress.
The multi-billion dollar initiative—touted as one of Canada’s largest automotive investments—was initially backed by both federal and provincial governments, each pledging up to $2.5 billion in financial support. However, no funding has yet been distributed, according to Ontario officials.
When complete, the project was expected to create 1,000 new jobs and retain 4,200 existing positions, with a production target of up to 240,000 vehicles annually by 2028.
Experts link the delay to multiple factors. Tariffs introduced by U.S. President Donald Trump have impacted Japanese automakers like Honda, while slower-than-anticipated consumer adoption of EVs has tempered industry optimism. Honda’s annual profits dropped 24.5%, and executives say they’re re-evaluating global investments carefully.
Flavio Volpe of the Automotive Parts Manufacturers’ Association and other industry leaders warn that Canada must restore investor confidence by addressing these headwinds. Analysts like Gal Raz from Western University also point to gaps in Canada’s EV infrastructure and affordability as obstacles to faster adoption.
Despite the delay, Honda has denied plans to exit Canada, and Premier Doug Ford insists the company will be held accountable for its commitments. Industry leaders continue to see electrification as the future, but timelines may now stretch further than initially anticipated.
Source: Swifteradio.com
