On one end, Chrysler and General Motors are threatening to close down Canadian plants… and on the other, Honda’s announcing it’ll build a new luxury crossover (the Acura ZDX) at its assembly plant in Alliston, Ontario. Honda added though, that no new employees would be hired to build the ZDX in Alliston.

The ZDX should arrive at dealers by fall.

Financial Post: Honda Motor Co., reeling from a 23% sales slide in Canada in the first quarter, will build a new luxury Acura model at its assembly facility in Alliston, Ont. to boost its high-end lineup.

Honda will add the all-wheel drive ZDX crossover model to its stable. The four-door vehicle will hit dealerships later this year, the company said at the New York Auto Show Wednesday after showing a prototype.

Auto manufacturers are scrambling to attract consumer attention in the worst market for new vehicle sales in a quarter century.

Among other engineering designs, Honda has hidden the ZDX’s rear door handles in the body of the vehicle and made the tailgate all glass. The automaker is also hoping to score with its new $23,900 Insight, a hybrid hatchback that competes with Toyota’s iconic Prius.

Honda built a previous Insight that pre-dated the Prius and topped fuel efficiency lists for years. But it discontinued the aluminum two-seater and never made money on it.

U.S. Acura sales have dropped off 35% in the first three months of 2009 compared with 2008, matching a 38% drop for luxury models overall. The brand’s sales are down 34% this year in Canada.

Industry experts are questioning how the sales magic faded so quickly for Honda. The company’s Civic compact, the top-selling vehicle in Canada for the past 11 years, was beat by the Mazda 3 for top honours in January and February.

“No vehicle is untouchable,” said Dennis DesRosiers, president of DesRosiers Automotive Consultants in Richmond Hill, Ont.

Honda volumes are suffering because it has not matched rivals in lowering prices aggressively and offering significant incentives this year, Mr. DesRosiers said. The company’s vehicles are also showing their age against key competitors, he said.

“They did start to address the price issue last month. It’s very difficult for them to address the product issues because you’re on a product cadence and they’re currently a little bit upside down on the product cadence. You really can’t move that very much.”

Honda insists its sales in Canada this year are off by only 13% compared with their average over the last five years. “We are encouraged to see that showroom traffic at our dealerships in March was up over the previous months, and that consumer confidence is showing a gradual upswing,” Honda Canada vice-president Jerry Chenkin said last week.

In January, Honda said it would cut Canadian output in Alliston by another 9,000 vehicles to respond to lower demand. One assembly line at the facility geared down from two daily work shifts to one. In late March, the company said it would trim production further and offer voluntary buyouts and early retirement packages to workers who want to leave.

A Honda spokesman said no new employees would be hired to build the ZDX in Alliston. The assembly site, which also builds the Civic and Acura CSX and MDX models, currently employs 4,300 people.