TORONTO — Prime Minister Mark Carney said Wednesday that Canada’s auto sector is facing pressure from U.S. tariffs amid reports that Honda may indefinitely suspend plans for a proposed $15 billion electric vehicle plant in Ontario.Speaking to reporters in Ottawa, Carney said the federal government would continue working with companies in the industry amid what he described as “unjustified tariffs” imposed by the United States on the auto sector.“There are challenges with the U.S. tariffs, unjustified tariffs in the auto sector,” Carney said. “We’ll continue to work with companies in the sector, helping them reposition, reinvest, supporting workers there. We’ll continue to do what’s necessary, including getting the right deal in Canada’s interest.”Carney did not directly address reports concerning Honda’s proposed electric vehicle project.Japanese outlet Nikkei Asia reported Tuesday that slower demand in the United States is leading Honda “to put hybrids at the centre of its North American strategy,” prompting the company to reconsider some electric vehicle investments..In May 2025, Honda announced it would delay the Ontario project for two years. Honda chief executive Toshihiro Mibe said at the time the company would assess conditions in the electric vehicle market before deciding whether to proceed.Finance Minister Francois-Philippe Champagne said Wednesday there appears to be a broader slowdown in the transition to electric vehicles globally.“The word is ‘hold.’ It’s not unique to Canada,” Champagne said. “If you look at what’s happening in Europe, what’s happening also in the United States, it’s just that the market has been shifting.”A statement from Industry Minister Melanie Joly’s office said the global automotive sector is undergoing “significant change.”“American tariffs and changes to U.S. domestic policies are creating real pressures for automakers, prompting some to delay or scale back investments in electric vehicle and battery projects,” the statement said.The statement added that Canada would continue supporting automotive facilities by mitigating tariff pressures and maintaining production of fuel-efficient vehicles while preparing the sector for long-term growth and competitiveness.Honda Canada said it had “nothing to report at this time.”Earlier this year, Japan’s ambassador to Canada, Kanji Yamanouchi, said access to the U.S. market under the Canada-United States-Mexico Agreement is critical for Japanese investment decisions in Canada’s automotive sector.“All those cars made in Canada, of course sold in Canada, but at the same time, exported to the U.S. market,” Yamanouchi said. “For private companies, that means they have to calculate to increase profit. So, CUSMA is a very important part of the calculation.”The proposed Honda facility had been expected to begin operations as early as 2028.
