An incentive program offering rebates to those buying or leasing an electric vehicle has been suspended.
Transport Canada announced on Sunday, Jan. 12, that the Zero-Emission Vehicle program has been put on pause as funds have been fully committed.
The program, which was put into place in 2019, offered rebates of up $5,000 to those buying or leasing EVs to help meet the target of net-zero emissions by 2050 in Canada, with over 550,000 vehicles being sold or leased through this incentive so far.
The federal government set targets in 2023 for all companies that manufacture or import new vehicles that 20 per cent of those cars must be EVs be 2026, and that 100 per cent of vehicles sold must be EVs by 2035.
The program was scheduled to pause either on March 31, 2025, or once all available funding has been used, but now Canada's vehicle makers and auto dealers are calling for an end to the federal EV sales mandates altogether.
David Adams, President and CEO of Global Automakers of Canada, says Transport Canada told the company on Friday, January 10, that there was still $70-million in the fund.
"So we anticipated that that $70-million might last for at least a few more weeks, but the reality is we're notified on Monday by Transport Canada that the program has been shut down because all of the funds have been depleted. So it's mysterious to us in terms of how the program burns through $70-million over the course of two business days."
He says the government is lacking on infrastructure to support EVs.
"They need to be building out 110 charging stations or so every single day for the next 15 years to support the number of vehicles that they hope to have on the marketplace. So it really is the combination between not building out sufficient infrastructure, and now all of the sudden pulling the rug from under the feet of dealers, consumers, manufacturers."
Adams says the government isn't supporting their own mandate by removing these incentives.
"Our view is that the entire mandate needs to be re-evaluated because it's unreasonable to ask manufacturers to put vehicles into the marketplace and not provide some means by which consumers can reasonably afford to purchase these vehicles. And then manufacturers pay the penalty if they don't."
As of July 2024, there were approximately 30,000 EV charging stations across Canada, however Adams says to support the move to 100 per cent electric vehicles by 2035 that 690,000 chargers would need to be available.
In Canada, companies that don't meet the zero-emission vehicle sales targets may face enforcement actions under the Canadian Environmental Protection Act (CEPA).
Two provincial jurisdictions in Canada also have zero-emission mandates including Quebec and British Columbia. B.C. has a 90 per cent zero-emission target by 2030, and Quebec has an 85 per cent target by 2030 - with Quebec recently eliminating their incentive for consumers as well.