Slower market demand, tariffs and evolving production strategies cited as some of the reasons why Honda is pausing its Canadian EV plans

Honda announced on Tuesday that it has postponed a $15-billion electric-vehicle project, citing market demand, and is shifting some production of its popular CR-V model intended for the U.S. market to its Ohio plant because of tariffs. The halted investment marks by far the biggest project delay yet in Canada as the outlook for EV growth softens.

Ontario Premier Ford is vowing to hold auto companies that pull out from Ontario "accountable" after news that Honda announced it is putting a major electric vehicle supply chain planned for the province on hold.

Honda’s CA$15 billion commitment was touted by former Prime Minister Justin Trudeau as the “largest auto investment in Canada’s history.” It was to include a battery plant with an annual capacity of 36 GWh while an EV assembly plant would have been able to build as many as 240,000 vehicles per year from 2028.

Honda Canada spokesman Ken Chiu said Tuesday due to the recent slowdown in the EV market, Honda has announced an approximate two-year postponement of the Ontario investment.

Research from Canada's parliamentary budget watchdog indicates that manufacturers, between 2020 and 2024, unveiled plans to invest roughly $33 billion in EV and related supply-chain production. The Canadian government pledged $22 billion in financing and tax breaks to lure those companies.

The development won’t affect jobs at Honda’s Alliston, Ont., plant, but it comes at a turbulent for the province’s automotive industry

Japanese multinational Asahi Kasei Corporation and Honda Canada formed a joint venture to make battery separators in Niagara. Despite Honda pausing $15 billion in EV investments, Asahi Kasei says the project should continue with 'minimal' impact.