Rumours are circulating about a potential Honda EV plant for Canada, but don’t expect its concept EVs from CES to be built here. They’re more a signal of intent, says James Carter

In early January, I make my annual pilgrimage to CES to see the latest and greatest in automotive technology. Once a consumer electronics trade show, CES is now more about technology in every possible vertical you can think of, including automotive. OEMs don’t show their latest tech at auto shows any more, stop one is now CES.

This year, the traditional OEMs’ presence was a little more muted. However, one of the standouts was Honda.

Honda had two-and-a-half cars on display. I say half, as one was at the Sony booth as the joint venture Afeela sedan concept.

O Series “very interesting”

The other two vehicles on the giant Honda stand were very interesting. Called the 0 (zero) Series, with model names Saloon and Space Hub, Honda said in its press materials that its guiding principles were “thin, light and wise”; hence one wag suggested 0 Series stood for “zero details.”   

Saloon looked in profile for all the world like a long wheelbase 1990’s Lamborghini Diablo, with remarkably similar bumper details on the front and rear. Maybe this was the designer’s teenage dream car.

Viewed directly from front or rear, large digital display screens dominated where the grille or taillight panel on the Lamborghini would have been, and with similarly impractical gullwing doors and concept interior — all quite befitting of a concept car. Or a ’90s super car.

Will this be the first electric Accord?  As much as my teenage self would hope so, I doubt it.

The Space Hub was more of modern, conceptual take on today’s minivan, especially focusing on a huge amount of roof and side windows. The “thin” pillars and “light” interior were definitely a focus, but probably not “wise” for hot climates.

Any meaning for Canada?

So, do either of these 0 Series concepts, which would translate into relatively expensive production vehicles, mean anything for Canada, especially in light of the news that broke right before CES that Honda is considering locating a huge new EV factory in Ontario?

To answer that, it’s worth stepping back and taking a look at what Honda has been doing to date. 

Like all other Japanese OEMs, Honda has been rather tepid in venturing far into EVs. The very short-range Clarity EV was an utter failure when you could buy a Tesla Model 3 with five times the range for roughly the same money. Later, the ultra-cute Fiat 500-sized Honda e (sold only in Asia and Europe) was shelved after a 30 per cent price jump in two years.

Not a great start.

And now Tesla is swamping the industry with affordable, desirable, hi-tech electric vehicles. Honda knows it needs to do something.

The first solution is to partner with General Motors to produce the Prologue and higher-end Acura ZDX, which are sporty mid-size SUVs on the Ultium platform. These will be relatively expensive, priced in Canada between $60,000 and $90,000. Rumour has it these “sister” vehicles will be built alongside the similarly sized Cadillac Lyriq at GM’s Springhill, Tennessee plant, which makes sense.

GM and Honda also made some progress in jointly designing a low-cost EV with an MSRP target under US$30,000. This was shelved in October, citing “slower than expected demand and changing market conditions.” However, this could be PR speak for “our EV platform is too expensive” or “we’ll be destroyed by Tesla and Chinese low-cost competitors.”

The truth, though, is that Honda MUST figure this out. 

Lower price point

The bulk of Honda’s sales in Canada (and in most global markets) are vehicles in the $20,000 and $40,000 range. But they don’t have the protection of highly profitable pickup sales like, say, GM.

What’s more, this lower price point is in line with the Civic and CRV models built in Alliston, Ont., for the last 35 years. I’m speculating here, but maybe Honda has decided to do the low-cost EV thing alone, which would automatically put Alliston in the running.

As mentioned, recent reports say senior Honda management met with federal government ministers on what is likely an incentives shopping trip for an upcoming facility. Honda has reportedly proposed an investment of up to $18.5 billion, by FAR the biggest any OEM has made here.

This suggests the new facility is more than just a vehicle assembly plant and rather a large-scale battery manufacturing facility. Perhaps along the lines of those now being built in Ontario by Volkswagen and Stellantis. Batteries are energy-intensive to build, and Ontario’s relatively cheap and clean electricity, as well as a solid local supply of key battery ingredients, could make for a great location. 

That is, of course, if the governments cough up the appropriate incentives.

Honda + Canada = ?

So, back to my original question, do the Honda 0 Series concepts have much relevance for Canada? As vehicles for future production here, probably not. What they’re designed to do is send a message of intent.

I suspect that the timing of the unveiling of these concepts and the plant shopping reports was not a coincidence. It reinforces that Honda is (finally) getting serious about electric vehicles, a message that the federal government needs to hear, especially given Honda’s previous stance on EVs.

All of this is good news, as at the end of the day, if Honda ends up making lower-cost electric vehicles by Canadians for Canadians, that’s something we should all be very happy about.

James Carter is Principal Consultant of Vision Mobility, a Toronto-based consultancy that provides services to OEMs, Tier 1s, dealers, startups, industry organizations and companies on strategies to succeed in a New Mobility environment. Prior to that, James worked for Toyota for 19 years in Australia, Asia and North America.