Honda may postpone eighth North American plant pending USMCA extension

Honda Executive Vice President Noriya Kaihara told reporters that the Japanese carmaker is close to maxing out its North American production capacity and is considering an eighth assembly plant, but the project hinges on the renewal of the USMCA trade agreement. He said the company must decide within the next one to two years and hopes the new facility could be operational by roughly 2030. The comment was made while the United States, Canada and Mexico are in talks over extending the pact, after the U.S. imposed 50% tariffs on $20 billion of Canadian goods and Canada announced retaliatory measures.

Honda currently absorbs tariff costs rather than passing them to North American buyers. The automaker recently posted its strongest July sales in seven years, driven by high demand for hybrids, yet it has halted its long-term EV sales target and suspended an $11 billion Canadian EV project. Earlier, Honda shifted production of its U.S.-bound Civic hybrid from Japan to Indiana.