The program had been “paused” when funds ran out in January, but it has now officially ended.
Sales of electric and plug-in hybrid vehicles in Canada have gone down significantly since then.
Ministers have said that rebates will come back, but no timeline or details have been announced.
Transport Canada confirmed last Friday that the iZEV program has officially ended, making it unclear what the promised return of incentives will look like.
Indeed, while the program itself has been cancelled, this doesn’t prevent new incentives from being added later, although no timeline or precisions have been given.
The iZEV program was launched in 2019 in an effort to incentivize the purchase of zero emission vehicles in Canada.
Since then, iZEV has reportedly paid out $2,6 billion and was involved in the purchase of 560,000 electric and plug-in hybrid vehicles across the country.
Until January, buying a new electric vehicle or a PHEV with more than 50 km of electric range entitled Canadians to a $5,000 incentive, while choosing a plug-in hybrid that could go less than 50 km on a full charge still returned a $2,500 rebate.
Since the program was set up to run until its funds were depleted, the increasing popularity of electrified models over the last few years brought its end faster than initially predicted.
This caused a lot of issues in January of this year, when Transport Canada announced the program would come to an end soon, as funds were running out.
Unsurprisingly, buyers and dealers alike rushed to submit rebate applications in the following days, and the remaining budget was used up over a single weekend.
Since many dealerships had already given the rebate to customers and were waiting for the government to reimburse them, the program’s sudden end left hundreds of them to stomach the costs. Combined, these pre-emptive rebates amounted to more than $10 million.
ZEV Sales in Canada Fall 35% in June as Federal Incentive Remains on Hold
These dealers then pressured the government, which ended up reopening its claims portal in July to allow for the processing of these rebates, but new claims were not authorized.
Since then, no federal funds have been used to incentivize the purchase of EVs and PHEVs.
Sales figures show that incentives contributed significantly to the popularity of electrified models, since EV sales are down 31% through August over the same period in 2024.
Clean Energy Canada recommends that Ottawa reinstate the iZEV program by funding it to the tune of $1,7 billion over five years, while Sean Kingston, CEO of the Canadian Vehicle Manufacturers’ Association, estimates that the government would have to spend around $900 million per year to stimulate enough sales to reach its EV sales targets.
Instead, his group is pushing for Ottawa to partner with automakers to improve public charging in the country.
Federal minister of Environment Julie Dabrusin and minister of Industry Mélanie Joly have both said earlier this year that incentives would be coming back, but details are unclear, and the government seems to have other priorities at the moment.
Source: Automotive News Canada
