Honda Motor Co. Ltd. has tabled its $11-billion plan to start electric vehicle manufacturing in Alliston, Ont. The decision coincided with the automaker reducing its 2026 revenue forecast, and underscored the uncertainty in North American automotive sector due to U.S. tariffs on imported vehicles.
In April 2024, Honda announced it would establish battery-electric vehicle and fuel cell-electric vehicle assembly in Ontario by 2028, aiming for a capacity of 240,000 EVs per year. The project would also include a parallel EV battery plant.
In April of this year, the U.S. initiated a 25% tariff on imported passenger vehicles, light trucks, and certain automobile parts, which has forced the non-U.S. automakers like Honda to review their strategy for supplying finished vehicles to the North American market – and likewise how they supply component parts to their onshore manufacturing operations.
In March, ahead of the tariff imposition, Honda decided to relocate its 200,000 vehicles/year Civic hybrid project from Mexico to Greenville, Ind.
The tariffs also seemingly prompted General Motors’ plan to shift light-duty truck production from locations in Mexico and Canada to Fort Wayne, Ind.
Honda CEO Toshihiro Mibe said the company will review the Canadian project again in two years. the electric vehicle market is in two years before deciding whether to keep going with the project.
"What happens after two years and the starting time of the project, we have to observe … and ultimately make the decision," he said. "In the midterm, if the tariff measures are to be in place for a long time, then we will have to increase our production capacity in the United States."
