Workers assemble a vehicle at a Honda assembly plant in Alliston, Ont., in 2024.Carlos Osorio/Reuters
U.S tariffs and domestic policies continue to upend the automotive sector, a spokeswoman for Industry Minister Mélanie Joly says, after a report that Honda has shelved its $15-billion plan to build an electric vehicle complex in Ontario.
The Japanese auto maker announced the project in 2024 and suspended it for two years in 2025 amid slowing demand for EVs, U.S. import taxes and changes to U.S. policies that made purchases of emissions-free cars less affordable.
Japan’s Nikkei news agency reported on Tuesday that Honda is about to make the suspension indefinite, with the possibility of scrapping it altogether.
Honda Canada spokesman Ken Chiu did not address questions on the plan’s future. “We have nothing to report at this time,” he said, repeating a statement issued a year ago when the suspension was announced: “The company will continue to evaluate the timing and project progression as market conditions change.”
The project included an EV and battery plant in Alliston, Ont., where Honda has a factory, as well as related projects elsewhere in the province in partnership with POSCO Future M Co. and Asahi Kasei Corp.
Gabrielle Landry, a spokeswoman for Ms. Joly, said global automakers are facing “significant change.”
“American tariffs and changes to U.S. domestic policies are creating real pressures for automakers, prompting some to delay or scale back investments in electric vehicle and battery projects,” she said. “We remain in regular contact with Honda and will continue to put Canadians’ interest first.”
Prime Minister Mark Carney told reporters in Ottawa on Wednesday morning the U.S. tariffs are “unjustified” and that Canada is working to get the best trade deal possible ahead of the review of the U.S.-Mexico-Canada agreement. “We continue to work with companies in the sector, helping them reposition, reinvest, supporting workers there,” Mr. Carney said, without naming Honda. “We’ll continue to do what’s necessary.”