An environmental think tank is warning the federal government against repealing its electric vehicle mandate, instead suggesting that politicians should be helping to put more EVs on the road.
In a statement published July 4, Clean Energy Canada gave three recommendations to the federal government to help deliver affordable EVs to Canadians for less than $40,000, The Canadian Press reports.
The group, based out of Simon Fraser University in British Columbia, said Ottawa should retool its EV mandate by revisiting its near-term targets to help the auto sector "weather this temporary storm" of slumping EV sales.
"Any additional flexibility added in the regulation should be designed to achieve other EV-related goals, such as delivering more affordable EVs and building out Canada's charging network," says the statement by executive director Rachel Doran and director of public affairs Joanna Kyriazis.
In a Toronto Star op-ed, Doran and Kyriazis argued that EVs are being withheld from Canadians-despite polling that shows strong interest-as the country falls behind the rest of the world in EV sales.
"Canadians are some of the richest inhabitants on planet Earth, so why are we turning into a technological backwater?" they ask. "The short answer is Canada's walled-off, uncompetitive car market."
Canada's decision to align with the United States and impose a 100% tariff on Chinese EVs is part of the problem, they write. By contrast, Europe opted for tariffs of 8 to 35% to level the playing field for domestic automakers. They cite BloombergNEF: "There's a clear factor dividing which countries are seeing faster EV adoption and which are going slower: openness to Chinese carmakers."
Even a limited Chinese presence in the market can spur competition and push legacy automakers to take their EV launches seriously-disrupting but not displacing local industry, they argue. Opening the EV market "just enough" would help mitigate job losses, and trendsetters like BYD could even be invited to build in Canada.
To deliver affordable, under-$40,000 EVs, Clean Energy Canada calls on the feds to rethink its tariffs on Chinese EVs-a review scheduled for later this year-and to recognize European Union-approved vehicles.
Their pleas come on the heels of auto manufacturing leaders meeting with Prime Minister Mark Carney last week, in which the CEOs repeated their calls for the mandate to be repealed, The Canadian Press writes.
Starting next year, the mandate would require 20% of all new light-duty vehicles sold in Canada to be zero-emission vehicles. Those also include plug-in hybrid electric vehicles. The target rises annually to 100% by 2035. Recent data from Statistics Canada suggests EVs accounted for 7.53% of all new vehicles sold in April.
Following the meeting, the head of an organization representing Ford Canada, GM Canada and Stellantis said he was "cautiously optimistic" the government would take action on the mandate.
Clean Energy Canada warns that the pressure to repeal its mandate comes from "a traditional auto sector that is headquartered in and highly integrated with the U.S." And it comes at a moment when American EV and clean energy policy is "moving starkly away from the direction the rest of the world is headed."
The group called on Ottawa to re-fund the EV incentive program, but to also be clearer as to when the program will be phased out.
Canada launched an Incentives for Zero-Emission Vehicles program in 2019, which gave car buyers up to $5,000 toward the cost of an electric vehicle. But the program was abruptly suspended back in January when its funding ran out. This left many dealerships on the hook for the rebate if they hadn't already sent in their claim before the program ended. The federal government put nearly $3 billion into the program during its lifespan.
"The rebate should start at $5,000 and decline by $1,000 each year, providing consumers and automakers with a well-communicated phaseout that avoids periods of artificially lowered EV sales as buyers await the return of rebates or at least clarity," Clean Energy Canada says.
A similar policy is in place in Quebec.
Federal ministers have said in recent months that the government was working toward bringing back consumer incentives on EVs. Those promises faced criticism from automakers themselves because, without implementing a rebate, EV sales are slumping further, as buyers wait for the rebates to come back.
This report by The Canadian Press was first published July 6, 2025.
Source: The Energy Mix
