OTTAWA — Joanna Kyriazis, director of public coverage at Clear Vitality Canada, made the next assertion in response to Honda’s $15 billion funding into Ontario to construct an built-in electrical automobile battery provide chain:
“In the present day’s announcement from Honda marks what’s by far the most important auto sector funding in Canada’s historical past and is a $15-billion greenback vote of confidence in Canada’s EV business—and a transparent indicator that the way forward for the worldwide auto market is electrical.
“Honda will carry to Ontario new manufacturing actions and jobs within the three highest worth components of the EV battery provide chain: battery supplies manufacturing, battery cell manufacturing, and EV meeting. The funding will considerably broaden Honda’s presence in Canada, additional onshore North America’s EV provide chain, and up Honda’s EV recreation.
“Honda’s funding joins a powerful checklist of EV and battery tasks destined for Canada, demonstrating simply how a lot our nation stands to realize because the world shifts to a cleaner economic system. Between 2020 and 2024, investments in Canada’s EV battery provide chain have grown to a whopping $49 billion, blowing even a number of the most optimistic progress projections out of the water. Certainly, Clear Vitality Canada beforehand projected that an EV battery provide chain might create 250,000 direct and oblique jobs throughout the nation by 2030, assuming it landed two gigafactories—Canada is now on observe to open 4 such factories.
“The funding can be supported by each federal and Ontario authorities contributions of as much as $2.5 billion every. The federal portion can be totally coated by varied funding tax credit it just lately launched to construct Canada’s clear economic system and compete for international investments.
“Critically, at present’s success reinforces the truth that the big alternative earlier than us will solely be totally realized when the federal authorities and provinces work collectively.
“EV gross sales are persevering with to smash data each globally and domestically, with one in 5 automobiles offered globally in 2024 projected to be an electrical automobile. Canada’s auto sector is positioning itself to play a central position in assembly rising demand for these cost-saving, carbon-cutting automobiles. A latest Clear Vitality Canada examine discovered that EVs can save drivers tens of hundreds of {dollars}.
“Canada just lately bumped China out of the high spot in BloombergNEF’s International Lithium-Ion Battery Provide Chain Rating, an annual evaluation that charges 30 international locations on their potential to construct a safe, dependable, and sustainable lithium-ion battery provide chain. And that was earlier than at present’s announcement.
“In different phrases, Canada is properly on its method to reinventing itself as an automotive heavy weight for our altering world.”
RESOURCES
KEY FACTS
- Honda’s plans will embody:
- A brand new EV meeting plant and a battery cell manufacturing plant on the firm’s Alliston campus, the place Honda at present builds the CR-V and Civic. The EV meeting plant will construct as much as 240,000 automobiles per 12 months, and the battery plant may have a producing capability of as much as 36 Gigawatt-hours per 12 months. Manufacturing is about to start in 2028.
- Two extra factories with yet-to-disclose areas in Ontario:
- A cathode energetic materials and precursor cathode energetic materials manufacturing facility in a three way partnership with South Korea-based Posco Chemical compounds.
- An EV battery element manufacturing facility in a three way partnership with Japan-based Asahi Kasei.
- Collectively, these investments will protect 4,200 current jobs and create at the very least 1,000 extra.
- Honda’s battery cell manufacturing plant would be the fourth battery gigafactory Canada has landed within the final two years. The others embody a $7 billion Volkswagen plant in St. Thomas, Ontario, a $7 billion Northvolt plant exterior of Montreal, and a $5 billion Stellantis-LG Vitality plant in Windsor.
- Each the federal and Ontario governments will contribute as much as $2.5 billion in help of this deal. The federal authorities’s contribution can be totally supported by the 30% Clear Expertise Manufacturing Funding Tax Credit score introduced in Funds 2023 and the ten% EV Provide Chain Funding Tax Credit score used for buildings introduced in Funds 2024. This differs from the federal bundle provided for the opposite three battery crops offers, which included manufacturing tax credit designed to match the U.S. Inflation Discount Act.
- EVs made up 18% of all new automobiles offered globally in 2023, based on the Worldwide Vitality Company’s just-released International EV Outlook 2024. In Canada, 11.7% of recent automobiles offered have been electrical final 12 months, up from 8.9% in 2022.