Auto industry calls on Ottawa to pump brakes on EV mandates as incentives dry up

Ottawa officially announced an abrupt pause to the federal government’s electric vehicle incentives on Monday, swerving the Canadian auto industry off the road — and now, industry leaders are calling for an end to federal EV sales mandates. 

Ottawa has set targets for the auto industry to achieve 100 per cent zero emission vehicle sales (for new, light duty vehicles) by 2035. The government wants 20 per cent of new vehicles sold by 2026 to be electric, and 60 per cent by 2030. 

Huw Williams, spokesperson for the Canadian Automobile Dealers Association, said the sudden pause has created confusion and chaos for dealers across the country. The abrupt announcement that the incentive program has run out of money has closed the portal that allowed dealers access to those incentives. 

Canada’s National Observer called several dealerships and can confirm the sudden pause surprised and impacted local dealers in Ottawa. 

Williams said he believes the market, not mandates, is the best tool to move the auto industry through the transition. 

“If you put artificially imposed mandates that are just kind of made up at a time when we don't know where the market is going to be, where the cost is going to be, what the trade ramifications are, that's just going to mean a lot of unnecessary pain for consumers,” he said.

Joanna Kyriazis, director of public affairs at Clean Energy Canada, told Canada’s National Observer she sympathizes with the auto industry and autodealers. She said the end of the incentives is a “huge oversight right at the time when Canadians can help make ends meet and reduce their monthly bills by getting a clean car that’s cheaper to own.” 

Canadian EV drivers save about $30,000 to $40,000 over the course of the vehicle's life compared to driving a gas-powered car, according to a recent Clean Energy Canada analysis. EV drivers can expect to save around $3,000 to $4,000 per year, which is the equivalent ofpaying $0.40 per litre at the pump over the vehicle’s lifetime. 

Still, many new EVs remain out of many working people’s budgets. The end of incentives that save consumers thousands doesn’t help.

Williams was joined at a Tuesday press conference by the Canadian Vehicle Manufacturers’ Association and the Global Automakers of Canada, calling on the government to abandon its sales mandates. 

Kyriazis is hopeful that prices for EVs are declining, and the used EV market is growing. It's still unclear how U.S. tariffs may affect market trends. 

Kyriazis thinks the last thing Canada needs to do is put the foot on the brakes on both incentives and mandates.

“It's really not the time to go backwards,” she said. 

Canada’s National Observer contacted Environment and Climate Change Canada, and Environment Minister Steven Guilbeault’s office but did not hear back in time for publication. 

Matteo Cimellaro / Local Journalism Initiative / Canada’s National Observer