If you want proof that Ontario is among the best locations on the planet to build cars, the place to start may be 66 kilometres north of Toronto at Alliston, the site of Honda Canada’s 890-acre manufacturing complex. With an engine plant and two assembly lines that can produce up to 400,000 vehicles a year, it regularly leads Honda’s 12 other North American production sites in quality and other key metrics. Even more impressive, Alliston is considered equal to the company’s best plants in Japan.

But with the coming shift to EVs, what is in store for this industrial gem, its 4,200 direct jobs and thousands more at suppliers? Ontario and federal officials watched anxiously as lavish U.S. federal and state incentives attracted a string of EV investments.

Although the Canadian side began breathing a bit easier in 2022 after landing major investments by Stellantis/LG and Volkswagen, securing the future of Ontario’s Honda and Toyota plants remained an urgent priority. To woo the Japanese, Ontario economic development minister Vic Fideli visited Japan three times and federal industry minister François-Philippe Champagne has flown over several times.

But with no Japanese buy-in as 2024 dawned, anxiety mounted. So the relief was palpable in April when Honda announced a $15 billion investment to upgrade Alliston for the EV era.

To find out what this massive undertaking involves, we spoke via video-conference with the president of Honda Canada, Jean Marc Leclerc, an affable Ottawa-born franco-ontarien.

“We’re going to build four brand-new plants,” Leclerc told us, “First is an assembly plant that will feature Honda’s approach to manufacturing EVs – and we will pioneer that approach here in Canada. That’s significant because typically the R&D is done in Japan and passed on to us. Second is a 200-gigawatt battery plant that will open in 2029. These two will be adjacent to our existing plants.”

Two other joint-venture plants, with Asahi Kasei and Posco, will produce battery components.

Picking his words carefully, Leclerc intimated that Alliston got the nod because its workers (“associates” in Honda lingo) are seen as more capable than their American counterparts. (Don’t worry, we won’t tell!)

“We could build this anywhere. But Alliston, in the Honda world, is among the top plants that we have globally. You don’t want to let go of that.

“The advantage, very simply, is a combination of green energy, the availability of skilled labour and proximity to the minerals and precious metals we need to build batteries. The closer you can bring that ecosystem to your manufacturing, the lower your cost. And with our dollar at 1.37 now, Canada’s got a big edge. It’s all about affordability: we need to build EVs that average Canadians can afford.”

While Alliston will eventually go all EV, Leclerc said Honda’s U.S. plants would maintain capacity to produce conventional vehicles along with EVs. “The situation is just too fluid right now,” he said.

Leclerc cited the vast supply chain that supports five global automakers as another key Ontario advantage, acknowledging that parts makers face a challenging transition to EVs, which will make many conventional components obsolete.

Tipping the scale, though, is the advantage of investment incentives provided by the federal and Ontario governments. While the amounts have not been officially announced, clearly they must match the multi-billion-dollar packages offered by states south of the border. Some support is in the form of tax credits, some is in supporting infrastructure and some is cash.

Leclerc cited the Investment Tax Credit that supports programs to boost environmental performance. “We’ve drilled a geothermal field that’s going to provide HVAC for the plant.”

From now though, the challenge is to build the new plants. “We’re going to be bringing in 3,700 temporary construction workers. They need lodging within an hour of the site, so we’re looking at different options including temporary housing at Camp Borden” (a huge military base nearby).

Now the Honda deal is settled all eyes are on Toyota, which has yet to commit to a program that would transition its two Ontario plants into the EV era. What’s clear though, is that Toyota sees in Ontario the same advantage as Honda: its highly skilled and competitive workforce. In 2014, the Cambridge South Plant, which produces the Lexus RX, was cited by the influential J.D. Power survey as the top plant for quality in the entire world. Every year since then, the plant has consistently ranked at or near the top of the same survey.

As Honda’s Leclerc said of Alliston, “You don’t want to let go of that.”