Return of subsidies for the purchase of electric vehicles
The Carney administration confirms the end of electric vehicle (EV) quotas and the return of purchase subsidies, in favor of new, stricter greenhouse gas reduction rules that have not yet been defined.
On Thursday, Ottawa presented its plan for the automotive industry, which has been hit hard by the trade war with the United States.
The federal government is providing $2.3 billion to encourage the purchase of 840,000 electric vehicles, with subsidies of $5,000 for electric cars costing less than $50,000 and up to $2,500 for the purchase of a plug-in hybrid electric vehicle.
This assistance will be available starting February 16 and will decrease over the years.
For EVs, the rebates will be $5,000 in 2026, $4,000 in 2027, $3,000 in 2028 and 2029, and $2,000 in 2030.
For plug-in hybrid vehicles, rebates will be $2,500 this year, $2,000 in 2027, $1,500 in 2028 and 2029, and $1,000 in 2030.
It will be first come, first served, meaning that the subsidy envelope is not infinite. Subsidies will apply to cars manufactured in Canada or in a country with which we have a free trade agreement.
Imported Chinese cars will therefore not be eligible.
The Carney government is also formalizing the end of electric car sales quotas, in another rejection of Justin Trudeau's legacy.
The previous Liberal government aimed for a 20% share of electric vehicles in sales this year, with a target of 100% by 2035, in order to reduce greenhouse gas emissions.
To compensate, the federal government promises to force manufacturers to build less polluting vehicles.
He claims that the new car emission standards are equivalent to adopting 75% electric vehicle sales by 2035 and 90% by 2040.
However, Ottawa admits that these figures are not based on any definitive model. It therefore does not know, in concrete terms, how the new formula will offset the elimination of electric vehicle quotas.
