Feds will unveil proposed changes to EV sales mandate this winter, officials say

An electric vehicle is charged in Ottawa on Wednesday, July 13, 2022. THE CANADIAN PRESS/Sean Kilpatrick

The federal government will unveil proposed changes to its electric vehicles sales mandate this winter, federal officials said Monday.

Mark Cauchi, director general of energy and transportation at Environment and Climate Change Canada, told MPs on the House of Commons environment committee his department is looking to share the results of its highly-anticipated review of the mandate by the end of the year.

Starting next year, manufacturers were supposed to ensure that 20 per cent of all new cars, SUVs and light-duty trucks sold are zero-emission vehicles, including plug-in hybrids.

The sales targets under the current mandate are supposed to increase steadily each year, rising to 60 per cent by 2030 and then 100 per cent by 2035.

On Sept. 5, Prime Minister Mark Carney abruptly paused the rollout of the EV mandate for 2026 and launched a 60-day review of it.

With U.S. tariffs hammering Canada’s auto sector, Carney exempted carmakers from those sales targets for a year to help give them liquidity — though those carmakers also have called for the complete repeal of the sales mandate.

“The review will consider potential amendments to sales targets, including the 2035 standard, and will explore possible additional flexibilities,” Cauchi told MPs on Monday, echoing the government’s messaging on the review when it launched.

Cauchi said the government will continue receiving feedback until Tuesday night, when the 60 days expire. He said the department hopes to publish the results of the review before the end of this year and seek to finalize any amendments to the EV mandate in late 2026.

During his opening remarks, Cauchi cited the success of EV sales mandates in other countries, noting that Norway will “likely” be the first country to achieve a 100 per cent sales target by the end of this year.

But Canada’s automakers have long said the mandate set out unrealistic targets they couldn’t possibly meet, given a lack of demand.

EV sales in Canada hit a monthly high of 18 per cent last year when the government was offering consumer rebates of up to $5,000. But sales plunged after the government abruptly ended the popular rebate program when its funding ran out.

The latest data from Statistics Canada shows EVs accounted for 8.77 per cent of new vehicle sales in August.

Federal ministers have said the government plans to reinstate some form of rebate program. But with no set date for their automakers have said the promise of the rebates is depressing sales because prospective buyers are waiting for them to return.

Under the current mandate, manufacturers that don’t meet their sales targets can buy credits from companies with a surplus of EV sales.

The Canadian Vehicle Manufacturers’ Association — which represents Ford, General Motors and Stellantis — warned in September automakers could be on the hook for billions of dollars in credit purchases if Canada’s electric vehicle mandate is enforced as written, and sales don’t ramp up.

The regulations also allow carmakers to invest in charging infrastructure to earn credits — one credit for every $20,000 invested. But the government capped that measure at 10 per cent of a company’s sales target — meaning automakers can’t buy their way out of a deficit by simply building charging stations.

On Monday, federal officials said changing the credit system is also on the table as part of the EV mandate review.

“Are these compliance flexibilities, such as the purchase of an infrastructure credit for $20,000, is that the appropriate level?” said Megan Nichols, the assistant deputy minister of the environmental protection branch at ECCC.

“Should it be something that is reconsidered to be at a lower level? Is it something that’s even effective at all? So all of these things are on the table.”

This report by The Canadian Press was first published Nov. 3, 2025

Nick Murray, The Canadian Press