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29 May 2026 / Quick Take
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Copy LinkThe Canadian federal government's new policies on electric vehicles are a reaction to pressures that include external tariffs, higher costs, and affordability concerns in a time of inflation.
One of Canada’s strategies for addressing climate change was to transition to 100% zero-emission vehicles (ZEV) sales by 2035.[1] But in early 2025, EV sales fell in response to the reduction or elimination of some government financial incentive programs and pushback against Tesla, the best-selling EV brand in Canada.[2] Purchases of nonplug-in hybrid vehicles partially compensated for the decline in ZEV sales. Since then, however, the share of ZEVs purchased has roughly doubled, and new government policies might accelerate adoption even beyond the prior peak.
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