Honda's investing $372 million into its facility north of Toronto that produces the Civic despite uncertainty generated by Donald Trump.
Despite the anxiety created by the uncertainty about the trade policies of the incoming Trump administration, Honda Motor Co. plans to move forward with a $372 million project to refurbish and expand its Canadian Assembly plant located north of Toronto.
Honda will invest $372 million in its Alliston factory, with financial support from the federal government and province of Ontario. The governments of Canada and Ontario will each contribute $30 million during three years.
In addition to retaining 4,000 jobs in Ontario, this funding will support advanced and clean technologies and position Honda Canada Manufacturing’s Alliston plants to be globally competitive for years to come, the Ontario Ministry of Development noted in a statement.
The company will use the funds to prepare the main assembly lines for the next generation of Civic and CR-V models and to complete a new state-of-the-art and energy-efficient paint shop. Honda is looking for ways to increase production of utility vehicles such as the CR-V.
(Trump threatens Canada, Mexico, with new border tariffs. Click Here for the story.)
HCM constructed its first facility in Canada in Alliston, Ontario, and started production in 1986. The facility now consists of four plants, including two vehicle production plants, one engine plant and a stamping forming plant.
Honda employs 4,000 contracted and full-time staff and produces the Civic and CR-V models. The company produced approximately 385,000 vehicles and 221,000 engines in 2015.
The announcement comes as Trump is putting pressure on automakers with facilities on U.S. soil to stop relocating production to Mexico, where a number of factories opened following the enactment of the North American Free Trade Agreement. The President-elect and officials from the new administration have also indicated they could also impose the 35% tariff on cars built in Germany and Canada.
(Click Here to see how scrubbing NAFTA could kill 30,000 jobs.)
Signed by Canada, the United States and Mexico, the agreement went into force in 1994.
The Republican billionaire, who has vowed to renegotiate NAFTA, is “a potential risk” for the Canadian automotive industry, Ontario Economic Development Minister Brad Duguid said on Monday.
However, he said he is convinced the U.S. President-elect would do nothing to hinder the industry’s cross-border supply chain, which links several factories in Ontario to others in Michigan and Ohio, crucial swing states that voted for Trump by small margins.
(To see more about Honda’s Mendel warning the industry about returning to bad habits, Click Here.)
The three major American automakers committed to investing Can$1.5 billion in their plants in Ontario when they reached collective bargaining agreements with employees represented by Unifor, the union that represents Canadian autoworkers.