Prime Minister Mark Carney acknowledged that the Canadian auto industry is facing “challenges” due to U.S. tariffs. His comments come amid reporting from a Japanese outlet that Honda is indefinitely suspending plans to build a $15 billion electric vehicle plant in Ontario.
“There are challenges with the U.S. tariffs, unjustified tariffs in the auto sector,” Carney said to reporters on Wednesday morning in Ottawa. “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 mention Honda specifically.
On Tuesday, Nikkei Asia reported that slow U.S. demand is pushing the Japanese automaker “to put hybrids at the centre of its North American strategy.”
‘We’ll continue to do what’s necessary’: PM Carney responds to auto sector concerns Prime Minister Carney speaks on circulating concerns in the auto sector after a report was released about Honda halting plans to build an EV plant in Ontario.
In May 2025, Honda announced it would delay the project for two years, with Honda chief executive Toshihiro Mibe saying the company would examine where the EV market is before deciding whether to move forward with the project.
Speaking to CTV’s Your Morning on Wednesday, Finance Minister Francois-Philippe Champagne would not confirm the report, but said “there seems to be a delay” with the transition to electric vehicles around the world.
“The word is ‘hold.’ It’s not unique to Canada. … If you look at what’s happening in Europe, what’s happening also in the United States,” Champagne said. “It’s just that the market has been shifting. If you ask my opinion, it’s been shifting a bit because of policies south of the border.”
In a statement to CTV News, Industry Minister Melanie Joly’s office said the global automotive sector is experiencing “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 reads.
“Canada will continue to support and protect existing automotive facilities by mitigating tariff pressures and sustaining the production of fuel-efficient vehicles, while positioning the sector for long-term growth, resilience and global competitiveness,” Joly’s office added.
Honda Canada, meanwhile, told CTV News the company has “nothing to report at this time.”
U.S. market access is critical for Japanese investment
In an interview with CTV’s Question Period back in February, Japan’s Ambassador to Canada Kanji Yamanouchi said continued access to the U.S. market, as provided for under Canada-U.S.-Mexico Agreement (CUSMA), is essential for current and potential increased Japanese investment in auto manufacturing in Canada.
“All those cars made in Canada, of course sold in Canada, but at the same time, exported to the U.S. market,” Yamanouchi said at the time. “(For) private companies, that means they have to calculate to increase profit. So, CUSMA is a very important part of the calculation.”
The Honda plant was slated to begin operating as early as 2028.
With files from CTV News’ Mike Le Couteur , CTV News’ Brennan MacDonald and The Canadian Press