Honda's Production Plans

Honda has reportedly scrapped plans to shift production of the next-generation Civic Hybrid to Mexico. Instead, the company will produce the vehicle at its Greensburg, Indiana, facility alongside the CR-V.

The change in plans comes as the Trump administration prepares to impose 25% tariffs on both Canada and Mexico. According to a report from Reuters, Honda had initially planned to move Civic production to Guanajuato, Mexico, but has now reversed that decision due to the impending tariffs.

Honda currently splits production for North America-bound Civics and CR-Vs between its facilities in Indiana and Ontario, Canada. The company had planned to begin production at the Mexico facility in November 2027, but will now start production in Indiana in May 2028, a six-month delay.

Impact of Tariffs

The tariffs imposed by the Trump administration are expected to have a significant impact on Honda's operations. The company imports around 40% of its U.S. sales from Canada and Mexico each year, and also exports roughly 60,000 U.S.-made cars to those countries. Any retaliatory tariffs would further hurt the automaker.

Honda's decision to cancel plans to build the Civic Hybrid in Mexico is likely a response to the uncertainty surrounding the tariffs and the potential impact on the company's bottom line. The move is seen as a way to mitigate the risks associated with the tariffs and ensure the company's continued competitiveness in the market.