Honda is abandoning plans to build a $15-billion EV plant in Ontario because of slumping demand, according to a report by Nikkei, Japan’s leading business publication.
It’s the second major blow to hopes for Canada’s EV industry since Prime Minister Mark Carney made it the centrepiece of his government’s new automotive strategy in February.
Honda neither confirmed nor denied the report.
“The content of the article was not released by Honda, and we have nothing to report at this time,” the company said in a written statement. Honda is scheduled to release its financial results for the fiscal year May 14.
The project, which was to include an EV battery plant, was originally designed to take advantage of green tax credits in the U.S. But U.S. President Donald Trump scrapped the credits in September, and also unveiled a series of tariffs which could impact the profitability of the plant.
In March, Honda announced it would be taking a $21 billion writedown as it revamps its global strategy.
At the time, the company cited increasing competition from other Asian manufacturers, a changing global trade environment thanks to U.S. tariffs, and slumping demand for EVs, partly because of the elimination of U.S. tax incentives for EV purchases.
“The business environment surrounding Honda is changing dramatically day by day, and the outlook remains uncertain,” Honda said in March. “The United States government policy shifts including the abolition of tax incentives for EV purchases, as well as the easing of fossil fuel regulations have slowed down the EV market.”
The Nikkei report noted Honda had already put the plans on hold for two years in May, 2025.
In February, Stellantis stepped back from its ownership stake in Windsor’s EV battery plant NextStar as part of a $35.5-billion global writedown on what it admitted were overly ambitious EV plans.
Stellantis announced that it is selling its 49 per cent stake in the $5 billion Windsor NextStar plant to joint venture partner LG Energy Solutions in exchange for a “nominal” fee, which LG’s disclosure documents say is $100.
Stellantis’s announcement came a day after Carney made electric vehicles the centrepiece of his government’s new automotive strategy.
