Prime Minister Mark Carney will announce Thursday that Canada is eliminating its electric vehicle sales mandate and replacing it with European-style fuel efficiency standards, CBC News reported, citing government and industry sources.
The move abandons targets requiring 60% of new vehicle sales to be electric by 2030 and 100% by 2035. Carney paused the 2026 targets in September and launched a 60-day review after automakers and provinces raised concerns about meeting the quotas amid US President Donald Trump’s tariff threats.
Ottawa will introduce corporate average fuel efficiency standards similar to European Union regulations, sources said. The system requires average emissions from all new vehicles to meet specific targets rather than mandating a percentage of zero-emission sales.
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The government will revive consumer rebates, offering $5,000 toward fully electric vehicle purchases and $2,500 for plug-in hybrids. A $1.5 billion infrastructure fund for charging stations will also be announced.
Canada’s previous incentive program, iZEV, was suspended more than a year ago after depleting its $3 billion funding pool due to high demand.
Automakers and multiple provinces had pushed Carney to eliminate the sales targets, arguing Canada already maintains other policies to meet emissions reduction goals.
Former environment minister Steven Guilbeault expressed concerns about scrapping the mandate entirely. “We need that mandate,” Guilbeault said. “It is essential. Not just for climate change, but in terms of air pollution, the impacts, the health benefits of doing this are very important.”
Also read: Poll Shows Most Canadians Don’t Want the Federal Electric Vehicle Sales Mandate
Electric vehicles accounted for 11.3% of new vehicle sales in Canada in November 2025, according to Statistics Canada. Monthly sales peaked at 18.29% in December 2024, before the incentive program ended.
The European Commission reports its emissions performance standards led to a 28% decrease in emissions from new passenger cars between 2019 and 2024.
The previous Liberal government established the original EV sales targets. Under the new system, manufacturers will earn and trade credits for producing electric vehicles, with credits from the old mandate carrying over to the new framework.
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