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Honda to get up to $5B in govt help for EV battery, assembly plants

Honda, a renowned automotive giant, is gearing up for a significant venture in Canada's electric vehicle (EV) landscape. The company has unveiled plans to construct an electric vehicle battery plant adjacent to its Alliston, Ont., assembly facility. This move aligns with its broader strategy of transitioning towards producing fully electric vehicles. The entire project, estimated at a whopping $15 billion, is poised to receive substantial support from the government, with up to $5 billion earmarked for this purpose.

The development holds promising prospects for employment generation, with an anticipated creation of 1,000 new jobs complementing the retention of the existing 4,200 positions at the assembly plant. Notably, this initiative does not entail production subsidies, a contrast to the approach employed to entice other automakers to establish battery plants in Ontario, leveraging incentives under the Inflation Reduction Act to divert investments from the United States.

The federal government is poised to extend support to Honda through avenues like tax credits, with an estimated value of $2.5 billion, aimed at fostering clean technology manufacturing and bolstering investments in the electric vehicle supply chain. Simultaneously, Ontario has pledged a comparable sum, spanning direct contributions for capital expenses as well as indirect support covering site servicing costs.

The comprehensive $15-billion endeavor encompasses the retooling of the existing plant, alongside the establishment of the adjacent EV battery facility. Additionally, it encompasses the setup of two crucial battery components facilities specializing in cathodes and separators, situated elsewhere within Ontario. This ambitious undertaking not only underscores Honda's commitment to embracing sustainable mobility solutions but also positions Canada as a pivotal hub in the global electric vehicle ecosystem.

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