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Honda expansion under caution flag as Trump tariff threats, end of EV mandates, loom ahead 

Posted January 27, 2025​

In April 2024, when Honda accounced one of its largest ever investments in Alliston to electrify its operations for electric vehicle and battery production, Joe Biden was President and candidate for reelection against then former President Donald Trump. Trump won the November race over Vice-President Kamala Harris, and inside his first few days as President last week, threatened 25 per cent tariffs on all Canadian exports into the U.S., while simultaneously ending legislated federal targets for phasing out fuel powered engines, and government funded buyer incentives. All direct hits on Honda's $15 billion plans for its 80 per cent exporting manufacturing operations in Canada.

 

The tariffs and EV policies are compounding issues that are separate problems - the tariffs aren't only targeted to EVs, but ending the mandates and eliminating government funded incentives for EVs, adds thousands of dollars out of pocket on top of the tariff.

Ken Chiu, Corporate Communications, Honda Canada told Free Press Online in an email this morning, "there are no immediate changes to our plans."​​

These plans include four new manufacturing plants in Ontario, an electric vehicle assembly plant – the first of its kind for Honda Motor Co., Ltd. – as well as a new stand-alone battery manufacturing plant at Honda’s facilities in Alliston. Honda will also build a cathode active material and precursor (CAM/pCAM) processing plant through a joint venture partnership with POSCO Future M Co., Ltd. and a separator plant through a joint venture partnership with Asahi Kasei Corporation. Once fully operational in 2028, the new assembly plant will produce up to 240,000 vehicles per year.

 

"What I can tell you is that we stand behind our current Canadian manufacturing and our plans for electrification production in Canada," wrote Chiu. "We are committed to supporting Honda’s global goal of carbon neutrality by 2050 with 100 per cent global EV sales by 2040. Hence, we will continue to take a measured approach by utilizing our portfolio of internal combustion engines, hybrids and EVs as we navigate the transition towards electrification. Our path is for the long term and with our flexibility in producing powertrains in North America, we can pivot accordingly."

At this post, Trump had not imposed tariffs, but has stated in American interviews they could begin Feb. 1.

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