Carney government will replace EV sales targets with rebates and new fuel-efficiency standards

The Carney government will drop planned EV sales mandates and introduce consumer rebates and new fuel-efficiency standards, the Star reports. The change is presented as a move to support Canadian auto manufacturing amid pressure from U.S. tariffs.

The federal government plans to unveil a new automotive strategy that drops the previously announced EV sales mandates and moves to new fuel-efficiency standards, government and industry sources told the Star. The reported plan would reintroduce consumer incentives or rebates for electric vehicles and may add funding for public charging infrastructure. The shift follows industry concern about the cost of meeting the mandates and growing pressure from U.S. auto tariffs that have affected production decisions. Labour and industry groups say the strategy must also support investment and production in Canada. Key details: - The new strategy is reported to remove the EV sales mandate and introduce new fuel-efficiency standards. - A government source said the plan will reintroduce consumer incentives or rebates for EV purchases and may provide more funds for public charging infrastructure. - Prime Minister Mark Carney and Industry Minister Mélanie Joly are scheduled to unveil the strategy on Thursday. - The EV mandate was paused last fall for 2026 while the government reviewed targets that had included higher percentages for 2030 and 2035. - Industry representatives, including the Canadian Vehicle Manufacturers Association and Unifor, told the Star they welcomed easing the mandate while keeping electrification and manufacturing competitiveness on the agenda. Summary: The announced shift aims to ease regulatory costs for automakers while maintaining policy support for electrification through incentives and new standards. The move is framed as a response to competitiveness pressures from U.S. tariffs and concerns about Canada's production footprint, and the strategy will be formally unveiled Thursday.