Honda Investing $11 Billion on Electric Vehicle Assembly and Battery Output in Canada

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Honda is set to embark on a substantial investment journey in Canada, earmarking a staggering $11 billion towards the establishment of electric vehicle assembly and battery output facilities. The announcement, scheduled to take place at the company’s manufacturing campus in Alliston, Ontario, will witness the convergence of Honda’s global leadership, including Honda Canada President Jean-Marc Leclerc, and prominent government figures, notably Canadian Prime Minister Justin Trudeau and Ontario Premier Doug Ford.

This substantial investment not only marks a pivotal moment for Honda but also sets a new benchmark in Canadian automotive investment. Surpassing Volkswagen Group’s $5 billion commitment made just over a year ago for a battery-cell plant in St. Thomas, Ontario, Honda’s endeavor underscores the country’s growing prominence as a hub for battery and electric vehicle production.

The planned electric vehicle battery plant in Alliston adds to Canada’s growing portfolio, which already includes commitments from other major players such as Volkswagen and Northvolt. With this momentum, Canada is solidifying its position as a key player in the global electric vehicle market.

The Alliston manufacturing campus, already home to three plants producing Honda CR-Vs, Civics, and four-cylinder engines, boasts impressive production capabilities, with the capacity to manufacture approximately 400,000 vehicles and 260,000 engines annually. This expansion will not only bolster Honda’s presence in Canada but also create employment opportunities, with about 4,200 workers currently employed at the site.

What sets Honda’s plans apart is their comprehensive approach, encompassing EV assembly, battery manufacturing, and battery component production. This integrated strategy positions Honda to take advantage of incentives such as the proposed 10 percent Electric Vehicle Supply Chain investment tax credit outlined in the 2024 federal budget.

Moreover, Honda’s investment model differs from previous battery manufacturing deals struck by the Canadian government, highlighting a tailored approach to align with the company’s strategic objectives. This focused investment aims to propel Honda’s North American electrification efforts, complementing its existing initiatives in the United States.

While specifics about the vehicles to be produced in Alliston remain undisclosed, industry analyst Sam Fiorani anticipates the commencement of production for a small electric crossover in 2027, followed by an electric crossover from Acura in 2028. This investment not only signifies a commitment to innovation but also underscores Honda’s commitment to advancing electrification in North America.

Source: Automotive News (subscription required)


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