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Honda (HMC) Contemplates $14B Plan to Produce EVs in Canada
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Reportedly, Honda (HMC - Free Report) is contemplating a project to set up an electric vehicle plant in Canada that requires an investment of $13.83 billion, which could also include in-house battery production.
Per Japan’s Nikkei news group report, this could be one of Honda's largest investments.
The automaker denied disclosing any information regarding the project. HMC’s EV sales have shown sluggish growth in 2023. In the first nine months of 2023, out of Honda’s total worldwide sales, that of battery-powered vehicles was less than 0.5%.
Per Nikkei news group, the automaker is exploring multiple sites for the plant, including a site next to an existing automobile factory in Canada. Honda is expected to make a call on this plant by the end of the year and the plant is expected to be ready by 2028.
For the past few years, Canada has been striving to entice EV manufacturers by offering tax breaks and speaking about the abundant availability of renewable energy sources and rare minerals used in EV batteries.
The company expects to start production and sales of EVs in North America by 2026, based on its new Honda e:Architecture.
In 2022, HMC announced a joint venture with LG Energy Solution to develop a site in Ohio for a $4.4 billion battery plant.
In October 2023, HMC and General Motors canceled a plan to develop affordable EVs after they agreed to partner on a $5 billion plan in 2022.
The latest initiative deployed by Canada to attract EV manufacturers is believed to be a prime reason behind Honda’s consideration of setting up a plant in the country.
The Zacks Consensus Estimate for VLVLY’s 2023 sales and earnings suggests year-over-year growth of 4.2% and 73.1%, respectively. The EPS estimates for 2023 and 2024 have improved by 4 cents and 3 cents, respectively, in the past seven days.
The Zacks Consensus Estimate for NIO’s 2023 sales indicates year-over-year growth of 11.8%. The EPS estimates for 2023 and 2024 have improved by 2 cents each in the past 30 days.
The Zacks Consensus Estimate for TM’s 2024 sales and earnings implies year-over-year growth of 12.4% and 45.4%, respectively. The EPS estimates for 2024 and 2025 have moved up $1.98 and 5 cents, respectively, in the past 60 days.
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Honda (HMC) Contemplates $14B Plan to Produce EVs in Canada
Reportedly, Honda (HMC - Free Report) is contemplating a project to set up an electric vehicle plant in Canada that requires an investment of $13.83 billion, which could also include in-house battery production.
Per Japan’s Nikkei news group report, this could be one of Honda's largest investments.
The automaker denied disclosing any information regarding the project. HMC’s EV sales have shown sluggish growth in 2023. In the first nine months of 2023, out of Honda’s total worldwide sales, that of battery-powered vehicles was less than 0.5%.
Per Nikkei news group, the automaker is exploring multiple sites for the plant, including a site next to an existing automobile factory in Canada. Honda is expected to make a call on this plant by the end of the year and the plant is expected to be ready by 2028.
For the past few years, Canada has been striving to entice EV manufacturers by offering tax breaks and speaking about the abundant availability of renewable energy sources and rare minerals used in EV batteries.
The company expects to start production and sales of EVs in North America by 2026, based on its new Honda e:Architecture.
In 2022, HMC announced a joint venture with LG Energy Solution to develop a site in Ohio for a $4.4 billion battery plant.
In October 2023, HMC and General Motors canceled a plan to develop affordable EVs after they agreed to partner on a $5 billion plan in 2022.
The latest initiative deployed by Canada to attract EV manufacturers is believed to be a prime reason behind Honda’s consideration of setting up a plant in the country.
Zacks Rank & Key Picks
HMC currently carries a Zacks Rank #3 (Hold).
Some better-ranked players in the auto space are Volvo (VLVLY - Free Report) , NIO Inc. (NIO - Free Report) and Toyota Motor Corporation (TM - Free Report) . While VLVLY sports a Zacks Rank #1 (Strong Buy) at present, NIO and TM each carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for VLVLY’s 2023 sales and earnings suggests year-over-year growth of 4.2% and 73.1%, respectively. The EPS estimates for 2023 and 2024 have improved by 4 cents and 3 cents, respectively, in the past seven days.
The Zacks Consensus Estimate for NIO’s 2023 sales indicates year-over-year growth of 11.8%. The EPS estimates for 2023 and 2024 have improved by 2 cents each in the past 30 days.
The Zacks Consensus Estimate for TM’s 2024 sales and earnings implies year-over-year growth of 12.4% and 45.4%, respectively. The EPS estimates for 2024 and 2025 have moved up $1.98 and 5 cents, respectively, in the past 60 days.