Prime minister Mark Carney recently unveiled a new national auto strategy for Canada. It brings back EV rebates for consumers, ends the EV mandate brought in during the previous administration, earmarks more money for EV infrastructure, and offers tariff relief to auto makers, all with an eye to the environment.
It’s an attempt to make lower emission vehicles more affordable to average Canadians and to develop a homegrown auto industry in Canada.
Carney says the new $2.3 billion strategy rests on five pillars.
“First, accelerating investment in Canadian auto manufacturing,” he said. “Second, rationalizing emission reduction policies to focus on the outcomes that matter to Canadians. Third, strengthening domestic demand by making electric vehicles more affordable and reliable for Canadians. Fourth, establishing a comprehensive trade regime that strengthens the competitiveness of our auto sector. And fifth, protecting Canadian auto workers from the immediate pressures while helping them bridge to the future.”
Carney says the aim of the strategy is to become less reliant on the U.S., protect Canadian jobs, and reward companies that build vehicles in Canada.
Beginning Monday, February 16, consumers who purchase or lease electric vehicles costing less than $50,000 qualify for a $5,000 rebate. For hybrids, it’s $2,500.
“Those incentives will only apply to vehicles produced in countries with whom Canada has a free trade agreement,” Carney added.
The prime minister also announced that $1.5 billion will go toward beefing the EV infrastructure so that Canadians, no matter where they are, will have much better access to charging their vehicles.
He’s also getting rid of the EV sales mandate implemented by his predecessor, Justin Trudeau. That mandate would have meant 100 percent of new vehicles sold in Canada by 2035 be electric. That is now 75 percent by 2035 and 90 percent by 2040. Instead, there will be new emission standards that will be outlined in the future.
That sits well with Brian Kingston of the Canadian Vehicle Manufacturers Association.
“This puts on a path to greater electrification while giving industry the flexibility it needs during a very difficult time,” Kingston said.
“Canada’s Industry Minister, Melanie Joly, says with the new strategy, Canada is going ‘all-in’ on auto manufacturing. The trend worldwide, she suggests, is toward electric vehicles.
“It is first and foremost a buy Canada policy. And of course, we also believe that the future of the industry is EV,” Joly said. “Why? Because by 2035 we know that 40 percent of the cars sold in the world will be EVs. We know that. While it is happening in Europe, it is happening in Asia and Latin America, everywhere. The only place in the world that has not really been happening is North America.”
So far car dealers and automakers have embraced the proposed changes. Environmental activists are more skeptical. They say while bringing back rebates is a positive move, the strategy itself is a weaker approach to getting rid of gas powered vehicles. But the Auto Dealers Association says it shows the government is willing to respond to market realities.
Opposition members of parliament say they have reservations, claiming there will be zero benefit to auto workers and manufacturers, and that taxpayers would be subsidizing foreign-made electric vehicles.
