You’ve probably heard there was a big announcement at Honda’s manufacturing plant in Ontario, but if you’re not sure what it’s all about, you’ve come to the right place.

This article gives you the highlights, as succinct as I can write them.

Alliston, Ont. is already home to Honda of Canada Mfg., which builds more than 400,000 vehicles each year, and that’s where the announcement was made, featuring a number of dignitaries, including Prime Minister Justin Trudeau, Ontario Premier Doug Ford, Honda executives and a number of government ministers.

Honda Motor Co., Ltd. plans to build a comprehensive EV value chain in Canada with an investment of about $15 billion.

What does that mean? Simply put, the company plans to build four new manufacturing plants in Ontario to support electric vehicle production, two on its own and two with partners.

Honda plans to build an EV plant as well as an EV battery plant, both to be located in Alliston.

Honda also plans to build a cathode active material and precursor processing plant through a joint venture partnership with POSCO Future M Co., Ltd., as well as a separator plant through a joint venture partnership with Asahi Kasei Corporation. These two plants will be announced in other Ontario communities.

The Alliston electric vehicle assembly plant will be a first of its kind for Honda. Once operational in 2028, it will produce up to 240,000 vehicles per year, a government news release said.

“Today’s announcement is a game changer for manufacturing in Canada,” Trudeau said in the news release. “Honda’s investment is a vote of confidence in Canada, in Canadian auto workers, and in our manufacturing sector. Together, we’re creating good-paying jobs, growing our economy, and keeping our air clean.”

Ford said Honda’s investment delivers on the government’s promise to bring back manufacturing jobs to Ontario, which will add thousands of good-paying union jobs and help rebuild the province’s economy.

“From our abundant critical minerals in the Ring of Fire to our highly skilled workforce, Ontario has what it takes to secure the jobs of the future as the world leader in electric vehicle manufacturing, with better jobs and bigger paycheques for our world-class workers,” the premier said in a news release.

Government support

So, where does the government come into this announcement?

The Canadian and Ontario governments are each contributing approximately $2.5 billion.

The federal government’s support is by way of a new program announced in Budget 2024, which introduced a 10 per cent EV supply chain investment tax credit. This credit is meant to attract investment in EV assembly, EV battery production and cathode active material production. Meanwhile, the Ontario government is providing up to $2.5 billion through various direct and indirect incentives.

Additionally, the Canadian and Ontario governments previously made matching investments of $131.6 million to help Honda Canada retool its manufacturing operations in Alliston for the next generation of hybrid EVs.

Jobs

Honda currently employs 4,200 at its two plants in Alliston. The company estimates the two new plants in Alliston (those being the the EV assembly plant and the battery manufacturing plant) will add a minimum of 1,000 workers, as well as significant spin off jobs.

Honda did not say how many direct jobs the other two plants would create.

“Honda is making progress in our global initiatives toward the realization of our 2050 carbon neutrality goal,” said Toshihiro Mibe, global CEO of Honda, in a news release from the automaker. “In North America, following the initiative to establish our EV production system capability in the U.S., we will now begin formal discussions toward the establishment of a comprehensive EV value chain here in Canada, with the support of the governments of Canada and Ontario. We will strengthen our EV supply system and capability with an eye toward a future increase in EV demand in North America.”

Honda aims to be carbon neutral by 2050. By 2040, it aims have 100 per cent of its vehicles be either batter-electric vehicles or fuel cell electric vehicles.