Photo credit: Perry Lefko
The Canadian automotive industry reacted favourably to Prime Minister Mark Carney’s plan for manufacturing electric vehicles without implementing mandatory sales targets.
The Canadian Automobile Dealers Association (CADA) formally applauded the federal government’s announced Auto Strategy, including the decision to end the federal Electric Vehicle Accessibility Standard (EV mandate).
“The announcement by Prime Minister Carney is a strong commitment by the government to the automotive industry and demonstrates their ability and willingness to respond to market realities and consumer demand,” said CADA President & CEO Tim Reuss. “The expanded and adjusted support measures aimed at maintaining Canada’s vital automotive manufacturing sector are essential as we enter the critical phase of the CUSMA renegotiation with the U.S. Dealers across Canada particularly applaud the government for ending the EV mandate and choosing a better path forward for EV adoption that is more in line with diverse technology, charging infrastructure and overall consumer demand.”
Reuss further noted that the 3,500 dealer members across Canada are in no way turning away from EV adoption.
“Dealers have invested heavily in EV infrastructure to sell and service EVs in Canada,” said Reuss. “Consumer choice in terms of vehicle options for low emission choices has expanded dramatically in Canada, and now manufacturers have the ability to deliver emissions solutions which are technologically neutral.”
Reuss also said CADA praised the reintroduction of EV purchase incentives.
“The announcement highlights that consumers still need incentives in order to adopt electric vehicle technology,” said Reuss. “The affordability gap for electric vehicles on initial purchase continues to be a pinch point, and the government’s approach to incentivizing consumers as opposed to limiting the market is the right step to ensure consumer affordability.”
Reuss also noted important elements of the automotive strategy that will help ensure a reliable supply chain for automobiles in Canada.
“During this trade rupture, it is critical that we have a strategy that is bold and eliminates policies that were made before current market and technology realities,” said Reuss. “CADA continues to work on both sides of the border to highlight that auto tariffs between Canada and the U.S. are bad for the economies of both countries, bad for dealers and, most importantly, bad for the millions of consumers they serve.”
David Adams, President of the Global Automakers of Canada, said: “We are pleased that the government has provided greater clarity on issues such as the Electric Vehicle Accessibility Standard, the reinstatement of EV incentives, and a commitment to aggressively build out the charging infrastructure.
“These are issues for which we have long sought direction from government and should give Canadians more choice, improve affordability, and make electrified vehicles more accessible. Achieving emissions goals requires clarity and certainty. A single, aligned electrification strategy across federal and provincial governments is critical for planning and investment purposes, as well as giving all Canadians the same vehicle options.
“We respect the government’s efforts to both sustain and encourage automotive investment in Canada, however, with all such announcements, the details matter. The consultation, timing, and ultimate implementation of the initiatives announced will be critical, with respect to their impact on industry and what Canadians see in the marketplace. We will review the strategy in detail over the coming days and provide our feedback to the government as part of the consultation processes.”
Flavio Volpe, President of the Automobile Parts Manufacturers’ Association, attended the announcement, where the APMA’s Project Arrow 2.0 was on display. Volpe said many of the details presented by Carney were things he was hearing for the first time, though collectively the auto industry worked on the structure together.
“What we said was ‘make sure it’s as robust on the supply side as it is on the demand side,’” said Volpe. “This government is doing a proper recalibration of mistakes that they made, and that’s the sign of a mature government. I appreciate that.”
Brian Kingston, President and CEO of the Canadian Vehicle Manufacturers’ Association, also attended the event and said he was very encouraged by the announcement.
“Getting rid of the EV mandate takes pressure off the industry at a time when we’re dealing with significant pressures because of U.S. tariffs,” said Kingston. “It also recognizes the government realizes there is not a supply issue in Canada for electric vehicles. We have a demand problem. What they’ve done is they’ve introduced incentives for EV purchases as well as for charging infrastructure. These are two key barriers to adoption and I think this plan will help Canada achieve higher rates of electrification while also protecting the sector right here.
“I think this is just a recognition of the data. We are currently sitting at 10 per cent EV sales in Canada. Under the EV mandate, the industry had to get to 23 per cent in the 2027 model year. That is over 200 per cent growth in sales. The mandate was disconnected from reality. Everyone in the industry knew that and anyone who had access to the sales data knew that. I think the government looked at it and realized this policy is not working, it has to be repealed and we need a new approach.”
He added there is still a future for electrification.
“If you look at the sales from Ford, GM and Stellantis last year, they are market leaders here in Canada, just shy of 40 per cent of all EV sales and they will continue to sell more EVs, but a mandate is not the way to do it,” said Kingston. “You’ve got to get at those barriers and what this announcement will do is encourage more Canadians to make the switch.”
The New Car Dealers Association of BC (NCDA) said the federal government’s decision to end the Zero-Emission Vehicle (ZEV) mandate and re-establish EV purchase incentives is a long-overdue recognition of market reality and is urging the B.C. government to follow suit.
After years of warning that ZEV mandates were disconnected from consumer demand, affordability pressures and infrastructure readiness, Ottawa’s decision marks what the association called a critical reset in automotive policy.
“This is a significant and positive course correction,” said NCDA President and CEO Blair Qualey. “Mandates don’t sell vehicles – consumer demand does. The federal government has acknowledged that reality, and we hope to see the provincial government do the same.”
The NCDA has consistently argued that ZEV mandates — at the federal and provincial level — place unfair pressure on consumers and dealers while doing little to meaningfully accelerate adoption. Additionally, the NCDA said that without intervention, automakers face a $20,000 penalty for every vehicle falling under the quota — costs that will ultimately be passed on to consumers.
“Ending the federal mandate sends a clear message: forcing targets without market support doesn’t work,” said Qualey.
The Canadian Charging Infrastructure Council (CCIC) said it supports the ambition of Canada’s new automotive package and framework for accelerating EV adoption and EV charging investment.
“Canada’s new automotive package could unlock billions of dollars in charging investment if implemented fully,” said Travis Allan, President and CEO of CCIC. “A Canadian vehicle emissions standard that achieves 75 per cent EV sales by 2035 and 90 per cent EV sales by 2040 will be a major step toward achieving a globally competitive automotive sector, provided that appropriate regulations are finalized in 2026.
“The government has listened to industry feedback that predictability and an orderly wind down for consumer incentives will help avoid market distortions and consumer disappointment. This announcement shows a pragmatic and predictable approach to policymaking that is highly welcome by business and will help Canadian families access EVs and save money.”
Plug’n Drive, a not-for-profit organization accelerating EV adoption in Canada, said in a media release that it welcomed the government’s announcement, especially the reinstatement of purchase incentives for battery-electric vehicles (BEV) and plug-in hybrid electric vehicles (PHEV) through the EV Affordability Program, as well as expanded investments in the national EV charging network. It said the measures address two of the most significant barriers Canadians face when considering electric vehicles — upfront vehicle purchase costs and access to convenient, reliable public charging.
