Canada is on the verge of an agreement with Honda Motor that would see the firm build electric vehicles and their components in the province of Ontario, according to people familiar with the matter.

The deal, expected to be announced within a week, involves a multibillion-dollar commitment by Honda for new facilities to process cathode active materials, build batteries, and assemble battery-powered vehicles — making southern Ontario a key hub of company’s EV manufacturing plans in North America. The Canadian government would subsidize a portion of the capital cost.

Honda has a manufacturing plant in Alliston, Ontario, about an hour’s drive north of Toronto, where it puts together Honda CR-V and Civic models. The company makes hybrid vehicles at factories in Ohio and Indiana, according to its website, and it plans to start manufacturing its first U.S.-made fully electric vehicles in Marysville, Ohio, next year.