The Canadian government is maintaining its stance on the zero-emission vehicle mandate (ZEV), even as the auto industry raises serious concerns that the mandated sales targets may be unrealistic, could lead to vehicle shortages, and might result in higher consumer costs.
Despite discontinuing its electric vehicle rebate program, the federal government of Canada appears committed to enforcing zero-emission vehicle mandates. These regulations require all new light-duty vehicles sold nationwide to be ZEVs within the next decade. This direction was highlighted in remarks made by Mélanie Joly, Minister of Innovation, Science, and Economic Development, during an event hosted by the Automotive Parts Manufacturers’ Association (APMA) near Toronto, according to Automotive News Canada.
The minister didn’t explicitly confirm that the ZEV mandate will remain in place, but her comments suggest it is unlikely to be withdrawn. She emphasized the need to collaborate with the industry and press the sector to embrace the transition. Joly also mentioned that the federal EV rebate program would be reinstated, though she did not provide a timeline for its return.
A sharp drop in ZEV adoption at the beginning of 2025 has hindered Canada’s ability to meet its targets. According to the latest monthly figures from Statistics Canada, ZEVs accounted for just 8.6% of new vehicle sales in the first four months of the year—down from 12.9% during the same timeframe in 2024 and significantly below the December peak of over 20%.
Under Ottawa’s mandate, automakers must ensure that ZEVs make up 20%, 60%, and 100% of their sales by the 2026, 2030, and 2035 model years, respectively. To support compliance, companies have the option of earning offset credits either by purchasing them from other manufacturers or by investing in charging infrastructure.
Minister Mélanie Joly acknowledged the recent dip in ZEV adoption but affirmed that the government remains focused on stimulating consumer demand.
While Joly did not confirm whether the government might ease the existing sales targets, she stated she is ‘always willing to have conversations’ on the matter.
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