Previously, Toyota Inc informed the Canadian trade delegation that if the USMCA (CUSMA) was dissolved, the most important auto manufacturing operation they have in the country would end. Toyota was being respectful and brutally honest with the Canadians.

Last year, at almost the same time as Toyota made their position clear, Honda put a pause on the plan to build EVs in Ontario [2025 Notice] pending additional review. Today, according to Nikkei, Honda has now completed that review and cancelled the plan. Honda will not build EVs in Canada.

Asahi Kasei, the Japanese material supplier that makes battery separators, a core component used in lithium-ion batteries, will likely make a similar announcement soon. The decision is in response to declining EV sales in combination with current U.S-Canada trade friction. Without guaranteed access to the U.S. market, it makes no sense to invest in Canada.

Electrek – “Honda is shelving its massive C$15 billion ($11 billion) EV and battery manufacturing hub in Ontario, Canada, according to a new report from Nikkei. The move escalates what was initially framed as a temporary pause into what increasingly looks like an indefinite retreat.

[…] When Honda announced the Alliston, Ontario project in April 2024, it was billed as the company’s most ambitious EV commitment yet. The plan called for a new EV assembly plant capable of producing 240,000 vehicles per year, a 36 GWh battery factory, and cathode material processing facilities through joint ventures with POSCO Future M and Asahi Kasei. Production was targeted for 2028.

By May 2025, Honda paused the project for approximately two years, citing tariff uncertainty under the Trump administration and softening EV demand. The company said at the time it would revisit the timeline in 2027. (read more)

https://electrek.co/2026/05/05/honda-shelves-11b-canada-ev-plant-electric-retreat/

Unfortunately, most Canadians have no idea about the background dynamics in this ongoing U.S-Canada trade friction. The Canadian government has strict controls in place to limit information to the Canadian people. The issue of Honda cancelling investment then has no context for the Canadian people to understand. Factually, it is quite sad.

https://theconservativetreehouse.com/blog/2026/05/05/honda-cancels-ev-plant-in-canada-despite-prior-deal-for-billions-in-subsidies/