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National Post
7 hours ago
- Automotive
- National Post
Internal government document predicted 'immediate' drop in EV sales without rebate subsidies
Article content The government document also assesses the impact of Trump's decisions to scrap previous U.S. electric vehicle policies, such as the 2030 mandate introduced under his predecessor, former president Joe Biden, as well as subsidies for battery-electric vehicles. Article content Article content It also touched on the impact that axing consumer incentives would have on the situation in both Canada and the U.S. Article content 'Recent executive orders issued by President Trump, which intend to eliminate consumer supports for (battery electric vehicles), combined with the pause of Canada's incentives for zero-emission vehicles (iZEV) program have added uncertainty to the market,' it reads. Article content 'In particular, the intended removal of consumer supports in both countries will have an immediate negative impact on sales growth in 2025 as these initiatives make the price of (battery electric vehicles) competitive to their internal combustion counterparts,' it says elsewhere in the document. Article content The document warned the timelines for achieving price parity between battery-electric vehicles and traditional ones 'could further shift' as a result of Trump's policies. Article content A statement from Industry Minister Melanie Joly's office said it is working with the sector in response to the challenges. 'With unjustified US tariffs putting the entire industry at risk, the government recognizes the sector's concerns and is continuing to engage meaningfully with industry stakeholders to address and alleviate these challenges,' the ministry wrote. Article content The federal government announced back in January that it was hitting 'pause' on its $5,000 rebate program more than two months earlier than scheduled, saying the funding for that program had dried up. Article content It had launched the incentive in 2019 as a way to bring down the price of electric vehicles, which proponents of the policy say is needed to encourage more widespread adoption, blaming the abrupt cancellation for the drop in sales. Article content Brian Kingston, president and CEO of the Canadian Vehicle Manufacturers' Association, which represents Ford, General Motors and Stellantis, said while the industry wants the EV mandate gone, it also needs clarity on what the government intends to do when it comes to reintroducing a new rebate. Article content 'The lack of clarity is further damaging sales,' he said. Article content 'If you are bringing it back, you have to announce it with a very defined timeline, and you can't say that we're going to bring the … program back in six months. Because unfortunately, that means you then delay the purchase of these vehicles for another six months.' Article content 'We are looking at ways to reintroduce a purchase incentive worth up to $5,000 that supports Canadian workers, strengthens our domestic supply chains, and reflects the times we are in,' wrote Ministry of Transport spokesperson Laura Scaffidi in an email. Article content
07-07-2025
- Automotive
Amid tariffs and falling sales, is Canada's EV mandate doomed?
With U.S. tariffs on steel, aluminum and light-duty vehicles continuing to batter the Canadian automobile industry, the CEOs of Canada's big three automakers are asking for a break. They met with Prime Minister Mark Carney this week to lobby for the elimination of the Liberal government's zero-emission vehicle (ZEV) mandate (new window) . Maintaining it, they say, will cripple their companies and put thousands of jobs at risk. Carney cancelled Canada's digital services tax (new window) last weekend to keep trade negotiations going with the U.S. Could the ZEV mandate also be removed to help an auto industry bleeding from the trade war? And what would that mean for Carney politically if he did so? The mandate requires the number of new ZEVs sold in Canada to hit 20 per cent by next year, 60 per cent by 2030 and 100 per cent by 2035 in order to help the country hit its emission-reduction targets. Brian Kingston, president and CEO of the Canadian Vehicle Manufacturers' Association, who was at the meeting with Carney, said the electric vehicle mandate just can't be met as it stands. Kingston and other industry players say U.S. tariffs have led to a significant drop in the number of vehicles Canada exports, putting immense pressure on the industry. According to Statistics Canada, the number of light-duty vehicles exported to the U.S. in April was down 23 per cent over the previous year. Flavio Volpe, the president of Automotive Parts Manufacturers' Association, told CBC News that while Canada imports about $80 billion worth of automobiles and parts from the U.S. each year, it exports about 85 per cent of the light-duty vehicles that roll off the line. Many of those are plug-in hybrids or electric, but the market for those vehicles in the U.S. is declining just as it is in Canada. Killing the U.S. ZEV mandate In January, U.S. President Donald Trump eliminated his country's ZEV mandate that would have required half of all new vehicles to be electric by 2030. A White House statement said (new window) the mandate was scrapped in order to promote consumer choice. While not legally binding, that target had won the support of U.S. and foreign automakers. The passage of Trump's "big, beautiful bill" (new window) further hit the U.S. ZEV market by killing the $7,500 electric vehicle tax credit by the end of September. That credit was supposed to remain on the books until 2032. Canada had its own ZEV rebate. That program offered up to $5,000 toward the purchase of a new electric car and up to $2,500 on the purchase of a new plug-in hybrid. While it was supposed to stay in place until March, it was paused in January when it ran out of funding. De nouvelles voitures électriques sont alignées chez un concessionnaire Hyundai à Québec en octobre 2024. Les Manitobains qui achètent ou louent un véhicule électrique éligible peuvent bénéficier d'une remise allant jusqu'à 4000 $ dans le cadre d'une mesure incitative provinciale qui a débuté en juillet 2024. Photo: La Presse canadienne / Jacques Boissinot In April, the sale of zero-emission vehicles in Canada sat at only 7.5 per cent — a 28.5 per cent decline over April 2024. With exports and sales down and no rebate in place, manufacturers say there is just not enough demand to hit the 20 per cent target next year. Competing concerns Christopher Cochrane, the chair of the University of Toronto's political science department, says Carney is wedged between his environmental ambition and the need for an industrial policy that will keep people employed and protect the auto industry. But if Carney decided he needed to end the EV mandate, Cochrane said, he might have a window of opportunity. New EV rebate program in the works, environment minister says (new window) He has a coalition of people built not on any particular agreement with him, but built on a common disagreement with what they see as the main alternative — and that did give him the policy leeway to do things like get rid of the carbon tax, he said. But he said it isn't easy to navigate the environmental and economic concerns from within his own party. The risk, longer term, is that he starts to erode and blow up that coalition, Cochrane said. But right now I think he's still in pretty good shape. Fudging it Adam Chamberlin, an assistant professor in the Telfer School of Management at the University of Ottawa, said Carney likely doesn't want to frame any decision as the end of EV mandates. So 2035 maybe becomes 2036 or 2037, and the other interim goals for 2030 become 2031 or 2032, Chamberlin said. I think it's that kind of a fudge that we're going to see. Volpe says that just because the U.S. wants to abandon its EV ambitions, that doesn't mean Canada should follow suit. He says an electrified car market plays to Canada's strengths as a country with rich reserves of critical minerals, a sophisticated science and technology sector, a well-established supply chain and an ample supply of electricity. WATCH | Why experts think the future is still electric: Début du widget Widget. Passer le widget ? Fin du widget Widget. Retourner au début du widget ? Road to EV adoption: Why experts think the future is still electric Recent headlines have suggested that consumers are losing interest in electric vehicles, but a closer look at the trends tells a different story. CBC's Nisha Patel breaks down where we're at in the EV transition and why experts say the future is still electric. The rest of the world continues down the march [of electrification] undaunted, Volpe said. We need to make sure that as that [U.S.] market wakes up, we're first ones to access it. Volpe says any penalties for not meeting the ZEV mandate should be halted and it should be adjusted to better line up with market realities. He wants the federal government to reintroduce the EV rebate and expand it to include conventional hybrids, which he said would build support for EVs. The government said it plans to introduce a new rebate program (new window) , but that hasn't happened yet. Volpe also wants the federal government to help identify the electric cars that Canadians want, and help factories retool to meet that demand. Peter Zimonjic (new window) · CBC News
04-07-2025
- Automotive
Automakers want Canada to scrap its EV sales mandate. What would that do to emissions?
Début du widget Widget. Passer le widget ? Fin du widget Widget. Retourner au début du widget ? When Prime Minister Mark Carney met with automotive sector CEOs Wednesday (new window) about U.S. trade negotiations, one of the key issues the industry said they wished to discuss was the government's zero-emission vehicle (ZEV) mandate. The mandate requires a certain percentage of light duty vehicles (new window) — passenger cars, SUVs and trucks — that are sold to be either fully-electric vehicles or plug-in hybrids, starting with 20 per cent in 2026 and rising to 100 per cent by 2035. Brian Kingston, president and CEO of the Canadian Vehicle Manufacturers' Association, told CBC News on the way to the meeting that The targets that have been established cannot be met given current market forces. He later added that Canada already has other policies to meet its greenhouse gas emission targets (new window) . Burning fossil fuels such as gasoline and diesel is the main cause of climate change, and transportation is the second-biggest source of emissions in Canada (new window) after the oil and gas industry. The ZEV mandate is part of Canada's strategy to accelerate the adoption of electric vehicles and decarbonize the transportation sector. But if the mandate were scrapped, analysts say that would hurt efforts to fight climate change — and make it harder to find an EV for sale in parts of the country. Here's a closer look at why. How big a deal are emissions from passenger vehicles? In 2023, transportation accounted for 23 per cent of Canada's greenhouse gas emissions (new window) . Unlike some sectors that have cut emissions since 1990, transportation emissions have grown 33 per cent, driven by both freight heavy-duty trucks and passenger light trucks. Passenger vehicles alone accounted for about 12 per cent of Canada's emissions in 2023. The Canadian Climate Institute, a climate policy think-tank partly funded by Environment and Climate Change Canada, modelled 60 potential net-zero scenarios and found that switching to zero-emission vehicles was central to every one. (new window) Arthur Zhang, senior research associate at the institute, said EVs are one of the most reliable technologies we have for reducing emissions in the transportation sector. WATCH | Canada's plan to phase out gas-powered cars and trucks Début du widget Widget. Passer le widget ? Fin du widget Widget. Retourner au début du widget ? Canada's plan to phase out gas-powered car and truck sales by 2035 The federal government is laying out its final plan to phase out new, gas-powered passenger vehicles by 2035, with gradually increasing targets for manufacturers to meet. How would the ZEV mandate increase EV adoption? It aims to solve a few problems. One of the challenges up until now has been the lack of availability of electric vehicles in many parts of Canada. In a recent interview, Cara Clairman, president and CEO of Plug'n Drive, an organization focused on public education about EVs, said in many parts of Canada, it's still impossible to find an EV to test drive (new window) , due to low availability at dealerships. The exceptions are B.C. and Quebec, which have their own ZEV sales mandates. That means more dealers have [electric] cars, she said. If the vehicles are on the lots, you know, they sell more EVs. That's just the reality. Zhang said the mandate signals government support for the EV transition and gives manufacturers the push to focus on electric vehicles even during periods of slower demand, such as now. EVs accounted for 7.53 per cent of all new vehicles sold in April, down from a peak of 18.29 per cent in December 2024, now that federal, Quebec (new window) and B.C (new window) . rebates are gone. The federal government says a new rebate program is in the works (new window) , which consumers are waiting for, and Kingston says that's hurting EV sales right now (new window) . WATCH | Electric vehicles are becoming easier to find in Canada, but not easier to afford Début du widget Widget. Passer le widget ? Fin du widget Widget. Retourner au début du widget ? Electric vehicles are becoming easier to find in Canada, but not easier to afford Electric vehicles are becoming easier to find at Canadian auto dealers, but they are still more expensive than most gas-powered vehicles. EV experts encourage drivers to consider fuel savings and provincial incentives as they mull over their next car purchase. And he said it could also potentially lower the price of EVs, as manufacturers and importers boost the price of gas-burning vehicles relative to EVs and cross-subsidize them in order to meet sales targets. Ross McKitrick, an economics professor at the University of Guelph and an unpaid senior fellow at the Fraser Institute, predicted such a markup of gas vehicles in a recent study modelling the economic impacts of the ZEV mandate (new window) . However, he found that the extra markup from gas-burning vehicles would be offset by lower overall sales due to higher vehicle prices overall (reducing the size of Canada's vehicle fleet by 0.6 per cent by 2050). Manufacturers or importers can also earn credits toward the target by selling more EVs ahead of time, overshooting the target some years, or installing EV charging infrastructure, which could also help boost demand for EVs. However, those who don't meet the targets even with the credits would face penalties. WATCH | The road to EV adoption: Why the experts think the future is still electric Début du widget Widget. Passer le widget ? Fin du widget Widget. Retourner au début du widget ? Road to EV adoption: Why experts think the future is still electric Recent headlines have suggested that consumers are losing interest in electric vehicles, but a closer look at the trends tells a different story. CBC's Nisha Patel breaks down where we're at in the EV transition and why experts say the future is still electric. What impact would the mandate have on emissions? McKitrick's study found that initially, the impact would be modest, as people's cars age slowly before needing replacement. But by 2050, the EV mandate will have cut Canada's greenhouse gas emissions by roughly eight per cent compared to a base scenario without an EV mandate. That's large, considering that passenger vehicles make up 12 per cent of emissions right now, and emissions would already be declining due to some adoption of EVs. McKitrick said scrapping the mandate would mean forgoing that eight per cent cut to emissions. Couldn't other policies cut emissions if the ZEV mandate gets scrapped? Zhang said government subsidies such as funding for EV charging infrastructure and rebates for people buying EVs can make a difference, but those work better as complementary policies: They are not substitutes to the mandate as far as emissions reductions go, he said. He added that subsidies rely on taxpayer dollars, which may be less efficient than a policy to encourage manufacturers to make EVs more attractive. On the other hand, McKitrick calculated that the ZEV mandate would be roughly 10 times more expensive per tonne of carbon abated than the former federal carbon tax, which Prime Minister Mark Carney eliminated in March (new window) – although the ZEV mandate's cost would fall to zero once EVs and gas cars cost the same. That's already the case in some places outside Canada, Zhang said. WATCH | The North American fight against cheap Chinese EVs, explained Début du widget Widget. Passer le widget ? Fin du widget Widget. Retourner au début du widget ? The North American fight against cheap Chinese EVs, explained | About That Canada is stepping in line with the U.S. and imposing 100 per cent tariffs on all electric vehicles coming from China to combat the unfair advantage it has in the global marketplace. About That producer Lauren Bird explores why North America is closing the door on a massive source of cheap electric vehicles and why experts say consumers will pay the price. CORRECTION: At 1:47 in this video, we state that the cheapest Tesla on the market as of Aug. 28, 2024, in the U.S. is a Model Y for about $45,000 USD. In fact, the cheapest Tesla you can buy in the U.S. without a federal tax credit is the Model 3 Rear-Wheel Drive for $38,990. One strategy to boost EV sales and adoption that has been proposed by academics and EV advocates has been to scrap tariffs on Chinese cars (new window) , which sell for as little as $13,000 Cdn overseas. Zhang acknowledged, In the case where cheaper EVs are available to consumers, the EV mandate may not be as impactful. Emily Chung (new window) · CBC News
Global News
04-07-2025
- Automotive
- Global News
Automakers ‘cautiously optimistic' after meeting Carney over EV mandates
The head of an organization representing automakers said he's 'cautiously optimistic' after meeting with Prime Minister Mark Carney to urge him to repeal the electric vehicle sales mandate. Canadian Vehicle Manufacturers' Association CEO Brian Kingston joined the CEOs of Ford Canada, Stellantis Canada and GM Canada in a meeting with the prime minister on Wednesday in Ottawa. Along with discussing the impact of U.S. tariffs — the primary focus of the meeting — the automakers told Carney there's no way the industry can meet the targets set out in the EV mandate. The industry has long argued the mandate is unnecessary since Canada already has other policies to meet its emissions-reduction targets. 'Why would you put an EV mandate on top of your existing (greenhouse gas) regulations? It makes absolutely no sense,' Kingston told The Canadian Press. Story continues below advertisement 'Now, what's changed since it was designed and came into force is that we've had this collapse in EV sales.' 4:09 Trump reverses California EV mandate, says 100% electric cars would be a 'disaster for the country' The EV sales mandate requires that 20 per cent of all new light-duty vehicles sold in Canada next year be zero-emission. The target rises annually to 100 per cent by 2035. The most recent data from Statistics Canada shows EVs accounted for just 7.53 per cent of all new vehicles sold in Canada in April. EV sales peaked at 18.29 per cent in December, the last month before funding ran out of the popular Zero-Emission Vehicles rebate program. Get breaking National news For news impacting Canada and around the world, sign up for breaking news alerts delivered directly to you when they happen. Sign up for breaking National newsletter Sign Up By providing your email address, you have read and agree to Global News' Terms and Conditions and Privacy Policy Known as iZev, the rebates offered up to $5,000 off the cost of a new electric vehicle, but the program was suspended in January and that month sales dipped to 11.95 per cent. Story continues below advertisement Sales further fell to 6.8 per cent in February with the loss of the federal rebate program, and 6.53 per cent in March. They climbed slightly in April after Quebec reintroduced its own provincial rebate, which will be gradually phased out by January 2027. 'If we are going to hit the 2026 mandated target of 20 per cent EV sales, you would have to grow ZEV sales by 180,000 units,' Kingston said. 'There is simply no way that that can occur on such a short timeline, given all of the current market forces at play.' 2:24 BIV: EV sales in Canada plummet over last year While the government has indicated it plans to bring back some form of consumer rebate for electric vehicles, Kingston said making such a promise without a firm timeline for implementation promises to undermine EV sales even further. Story continues below advertisement Industry Minister Mélanie Joly said in May the government was looking at bringing back 'support programs' for EVs. Last month, Environment Minister Julie Dabrusin told The Canadian Press that Ottawa is working on bringing back a rebate program. The Liberal party's election platform promised to look at ways to 'reintroduce a purchase incentive worth up to $5,000.' 'Comments from ministers in the public suggesting that an EV incentive is coming back are extremely damaging,' Kingston said. 'If the government is going to bring it back, they've got to be clear about that with the plan and the timeline. And it has to be quick because if you tell people it's going to be in three months, then no one will purchase an EV for the next three months.' 5:14 Why EV Sales are suddenly slowing down Transport Canada is holding consultations on the rebate program. Hyundai Canada CEO Steve Flamand, who has called for the rebate to return, is meeting with department officials to discuss it next week. Story continues below advertisement 'For us, the program worked quite well,' Flamand told The Canadian Press. He added the sudden end of the iZEV program disrupted his company's supply chains. 'Obviously, it needs to be predictable, it needs to be stable, because our business does not shift in a matter of a couple of days,' he said. 'It pivots in a matter of six-month tranches.' Flamand said his company isn't opposed to the EV mandate, as long as it aligns with market demand. 'We believe in the cause, but right now I think 20 per cent… it's just not realistic. Nobody's going to do that,' he said. 'So having an unrealistic mandate without the natural market demand for it is a recipe for a disaster.' Kingston said bringing back the rebate program wouldn't be enough on its own to meet the EV mandate. 'Just to give you a sense of what the cost would be if you were to try and put in place a $5,000 incentive and increase sales by an additional 180,000 vehicles to meet the 2026 target, you'd be talking about nearly a billion dollars in spending,' he said. 'That is not a sustainable policy.' The government spent nearly $3 billion in five years on its EV rebates program.
National Observer
03-07-2025
- Automotive
- National Observer
Automakers hopeful that Carney will repeal EV sales mandate
The head of an organization representing automakers said he's "cautiously optimistic" after meeting with Prime Minister Mark Carney to urge him to repeal the electric vehicle sales mandate. Canadian Vehicle Manufacturers' Association CEO Brian Kingston joined the CEOs of Ford Canada, Stellantis Canada and GM Canada in a meeting with the prime minister on Wednesday in Ottawa. Along with discussing the impact of U.S. tariffs — the primary focus of the meeting — the automakers told Carney there's no way the industry can meet the targets set out in the EV mandate. The industry has long argued the mandate is unnecessary since Canada already has other policies to meet its emissions-reduction targets. "Why would you put an EV mandate on top of your existing (greenhouse gas) regulations? It makes absolutely no sense," Kingston told The Canadian Press. "Now, what's changed since it was designed and came into force is that we've had this collapse in EV sales." The EV sales mandate requires that 20 per cent of all new light-duty vehicles sold in Canada next year be zero-emission. The target rises annually to 100 per cent by 2035. The head of an organization representing automakers said he's "cautiously optimistic" after meeting with Prime Minister Mark Carney to urge him to repeal the electric vehicle sales mandate. The most recent data from Statistics Canada shows EVs accounted for just 7.53 per cent of all new vehicles sold in Canada in April. EV sales peaked at 18.29 per cent in December, the last month before funding ran out of the popular Zero-Emission Vehicles rebate program. Known as iZev, the rebates offered up to $5,000 off the cost of a new electric vehicle, but the program was suspended in January and that month sales dipped to 11.95 per cent. Sales further fell to 6.8 per cent in February with the loss of the federal rebate program, and 6.53 per cent in March. They climbed slightly in April after Quebec reintroduced its own provincial rebate, which will be gradually phased out by January 2027. "If we are going to hit the 2026 mandated target of 20 per cent EV sales, you would have to grow ZEV sales by 180,000 units," Kingston said. "There is simply no way that that can occur on such a short timeline, given all of the current market forces at play." While the government has indicated it plans to bring back some form of consumer rebate for electric vehicles, Kingston said making such a promise without a firm timeline for implementation promises to undermine EV sales even further. Industry Minister Mélanie Joly said in May the government was looking at bringing back "support programs" for EVs. Last month, Environment Minister Julie Dabrusin told The Canadian Press that Ottawa is working on bringing back a rebate program. The Liberal party's election platform promised to look at ways to "reintroduce a purchase incentive worth up to $5,000." "Comments from ministers in the public suggesting that an EV incentive is coming back are extremely damaging," Kingston said. 'If the government is going to bring it back, they've got to be clear about that with the plan and the timeline. And it has to be quick because if you tell people it's going to be in three months, then no one will purchase an EV for the next three months.' Transport Canada is holding consultations on the rebate program. Hyundai Canada CEO Steve Flamand, who has called for the rebate to return, is meeting with department officials to discuss it next week. "For us, the program worked quite well," Flamand told The Canadian Press. He added the sudden end of the iZEV program disrupted his company's supply chains. "Obviously, it needs to be predictable, it needs to be stable, because our business does not shift in a matter of a couple of days," he said. "It pivots in a matter of six-month tranches." Flamand said his company isn't opposed to the EV mandate, as long as it aligns with market demand. "We believe in the cause, but right now I think 20 per cent... it's just not realistic. Nobody's going to do that," he said. "So having an unrealistic mandate without the natural market demand for it is a recipe for a disaster." Kingston said bringing back the rebate program wouldn't be enough on its own to meet the EV mandate. "Just to give you a sense of what the cost would be if you were to try and put in place a $5,000 incentive and increase sales by an additional 180,000 vehicles to meet the 2026 target, you'd be talking about nearly a billion dollars in spending," he said. "That is not a sustainable policy." T
