Honda Cancels Plans to Build $15 Billion Electric Vehicle Factory in Canada: Report

Honda is indefinitely suspending its plan to build a $15 billion electric vehicle (EV) factory in Ontario, according to a Japanese news outlet.

Slow demand in the United States had forced the Japanese automaker to put hybrid vehicles at the “centre of its North American strategy,” and freeze plans for the EV factory, Nikkei Asia reported May 6.

The reported suspension comes a year after Honda CEO Toshihiro Mibe announced the company would postpone some large-scale investments in Canada for two years. Mibe said in May 2025 that the EV market had “slowed more than initially expected.”

Honda Canada hasn’t issued a statement on the matter and did not respond to The Epoch Times’ request for comment by publication time.

Honda’s projects in Canada included the EV manufacturing plant and a battery factory in Alliston, Ont., which was set to begin production in 2028. The company had also started working on a separator factory in Port Colborne, Ont., as well as a cathode active material plant and precursor cathode active material factory at another Ontario location in partnership with Posco Chemicals.

Honda Global said its profit for the financial year ending March 31, 2025, had fallen an annual 24.5 percent, and that U.S. tariffs would further impact earnings. The United States has imposed 25 percent tariffs on automobiles and automotive parts exported from Canada and Mexico.

Without mentioning Honda, Prime Minister Mark Carney told reporters in Parliament on May 6 that there had been “challenges” with U.S. tariffs on Canada’s auto sector.

“We’ll continue to work with companies in the sector, helping them reposition, reinvest, and support workers there,” he said.

Later in the day, Carney told reporters the Liberal government is in “constant contact with all the major automakers,” including Honda. Carney said Canada has twice the rate of foreign direct investment than the United States when adjusted for population, and said the government will “continue to get that investment, despite the efforts of the Americans.”

Conservative Leader Pierre Poilievre said Canadians were “terribly saddened” by the news of Honda cancelling the factory in Ontario, and this followed the “collapse of auto production under this Liberal government.”

Poilievre said the Liberal government’s plan is to “replace 83 percent of our automotive sales to the U.S. by making electric vehicles that people don’t want to buy.” He called for an auto pact requiring automakers to make one car in Canada for every car they sell in Canada.

Industry Minister Mélanie Joly did not respond to a request for comment from The Epoch Times by publication time.