Honda Motor Co. (HMC) has indefinitely suspended plans to build a $15-billion electric vehicle (EV) plant in Canada following a dismal earnings report from the Japanese automaker.
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Honda announced that it will no longer proceed with the EV project in the Canadian province of Ontario, saying the company will focus instead on rebuilding its automobile business structure over the next three years and allocate more resources to hybrid gas-electric vehicles that are in demand.
The announcement, which is another blow to Canada’s auto industry, comes after Honda reported a $2.7 billion annual loss (its first-ever full-year loss) due to the heavy costs associated with its global electric vehicle strategy.
Canada’s Struggling Auto Sector
The Canadian electric vehicle plant that was to be located outside of Toronto was first announced in 2024 and would have created 1,000 jobs. Last week, Canadian Prime Minister Mark Carney acknowledged that the Canadian auto industry is facing “challenges” due to hefty U.S. tariffs.
The Honda electric vehicle plant was described as “Canada’s first comprehensive electric vehicle supply chain” and was slated to open in 2028. The assembly plant was expected to produce up to 240,000 electric vehicles per year for Honda.
HMC Stock Performance
Let’s look at Honda’s stock performance. As one can see in the chart below, the company’s share price has declined 23% over the past three months as the automaker struggles financially.
