Honda explores $14 billion EV production in Canada: Report- Republic World

Honda Motor Co is reportedly contemplating a substantial investment of nearly 2 trillion yen (approximately $13.83 billion) to establish an electric vehicle plant in Canada. The project, if realised, could mark one of Honda’s most substantial investments to date, according to reports from Japan’s Nikkei news group on Sunday.

While Honda has refrained from providing specific comments on the reported plan, the project’s potential scope includes in-house production of batteries. The Japanese automaker has been relatively cautious in entering the electric vehicle market, and this initiative could signal a noteworthy shift in its strategy.

Canada’s industry minister’s office responded to the reports, stressing that Honda’s potential significant investment underscores the country’s workforce quality and the robustness of its industry. The spokesperson highlighted Canada’s growing reputation as a preferred green supplier and a global leader in electric vehicles.

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As of the first nine months of 2023, battery-powered vehicles constituted less than 0.5 per cent of Honda’s global sales, which totalled about 2.8 million cars, according to company data. The reported plan suggests that Honda is keen to bolster its presence in the EV market.

The Japanese automaker is said to be evaluating various potential sites for the new plant, including a location adjacent to an existing automobile factory in Ontario. A decision is expected by the end of the year, with the possibility of the plant commencing operations as early as 2028.

Honda already has plans to commence the production and sale of EVs in North America in 2026, based on its new Honda e:Architecture. In collaboration with LG Energy Solution, the company announced a $4.4 billion joint-venture battery plant in Ohio in 2022.

However, in October 2023, Honda and General Motors abandoned their joint plan to develop affordable electric vehicles, a year after initially committing to a $5 billion effort to compete with Tesla in sales. The latest initiative in Canada could signify Honda’s independent push towards a more assertive role in the rapidly evolving electric vehicle market.

(With Reuters inputs)