OTTAWA: Canada’s federal government has moved to delay the start of its Electric Vehicle Availability Standard by waiving 2026 model year vehicles from the program and launching a review of the rule, as officials prepared to brief reporters on a new national strategy for the auto industry.
The Electric Vehicle Availability Standard is built into amendments to Canada’s passenger automobile and light truck greenhouse gas emission regulations. It requires automakers and importers to meet annual zero-emission vehicle sales targets that start at 20% of new light-duty vehicles offered for sale in the 2026 model year, rising to 60% by 2030 and 100% from 2035 onward, covering passenger cars, SUVs and light trucks.
The framework includes a compliance credit system designed to provide flexibility as companies transition their fleets. Companies that exceed their annual target can generate credits that may be banked for up to five model years or traded, while companies that fall short generate a deficit that must be discharged within three model years. The rules also include early action credits for model years 2024 and 2025 and allow limited credits tied to eligible investments in new fast-charging infrastructure.
In September 2025, Prime Minister Mark Carney said the government would remove the 2026 Electric Vehicle Availability Standard requirement and begin an immediate 60-day review aimed at identifying additional flexibilities and reducing costs. A separate government release described the move as waiving 2026 model year vehicles from the standard’s requirements and said it would provide immediate financial relief to automakers.
National automotive strategy briefing
On Feb. 4, Innovation, Science and Economic Development Canada said senior officials from that department, Transport Canada and Environment and Climate Change Canada were scheduled to hold a technical briefing on Feb. 5 in Ottawa on the launch of a new strategy to transform Canada’s automotive industry. Separately, the Prime Minister’s Office said Carney was scheduled to tour an auto parts manufacturing facility in Vaughan on Feb. 5 and announce new measures aimed at transforming Canada’s auto manufacturing sector.
The federal electric vehicle policy has been designed to align with a wider North American market that is increasingly governed by similar requirements in several U.S. states, including California. Canada’s framework defines zero-emission vehicles as battery electric vehicles, hydrogen fuel-cell vehicles and plug-in hybrid electric vehicles that meet a minimum electric-only driving range, with limits on how much of a company’s annual obligation can be met through plug-in hybrids in the early years.
Regulations also rest on the government’s stated view that vehicle choice and supply will expand as automakers add models. In the backgrounder accompanying the standard, the government said more than 50 zero-emission vehicle models were available in Canada in 2023 and cited industry plans for additional models arriving in 2024, as the policy’s targets ramp up through the end of the decade.
Canada’s auto sector and incentives
The federal government has linked the electric vehicle targets to investment and employment in the broader automotive supply chain. In its backgrounder on the standard, Environment and Climate Change Canada described the auto sector as Canada’s second-largest exporter, supporting 500,000 jobs, and said it contributed more than $14 billion to the economy in 2022. The same document said Canada had secured more than $34 billion in investment in the battery and automotive supply chain since 2020.
Consumer-facing supports have shifted over the same period. Transport Canada has said its Incentives for Zero-Emission Vehicles program has ended and is no longer accepting applications, while federal incentives for medium- and heavy-duty zero-emission vehicles have continued under a separate program. Provinces also maintain their own rules, including British Columbia’s Zero-Emission Vehicles Act with accelerated sales targets and Quebec’s separate zero-emission vehicle standard that uses a credit-based approach for regulated automakers.