the federal government extends the subsidy until 2025

We expected big announcements from Ministers Guilbault and Champagne, at the end it was a courtesy visit to confirm the extension of the subsidy at the same level as today.

during the last federal budget, the Government of Canada has made several announcements about expanding its involvement in the electrification of transport, particularly the automobile. In fact, the government will invest $400 million to add around 50,000 charging stations to the current network. At the same time, the Infrastructure Bank of Canada has a $500 million envelope that will go directly to charging facilities for electric or plug-in hybrid vehicles.

$1.7 billion more

However, the aspect that most affects consumers is the US$ 1.7 billion envelope for the expansion of the incentive program for zero-emission vehicles. The goal is to further reduce consumer bills. Under current conditions, to qualify for the Government of Canada’s US$5,000 rebate, the vehicle must be fully electric and with a base price (before freight and delivery charges) below US$45,000. However, there is one exception, the plug-in hybrid Chrysler Pacifica, due to the size of its battery and the number of seats on board (7). Other vehicles, plug-in hybrids, are also eligible for a $2,500 discount. There is now a good evolution of the situation.

As part of the Montreal Electric Auto Show, it was an opportunity for the Government of Canada to clarify its intentions and new directions in terms of subsidies for the purchase of electric vehicles. Unfortunately, despite the presence of the Minister of the Environment and Climate Change, Steven Guilbault, the Minister of Innovation, Science and Industry, Philippe-François Champagne, the Minister of Economy and Innovation of Quebec and the Minister responsible for Regional Economic Development, Pierre Fitzgibbon and Éric Filhamento of Hydro-Québec, the only information to remember is that the subsidy is renewed until 2025. While nothing was said during the press conference, strange.

Most qualified vehicles

Ultimately, it was Transport Minister Omar Alghabra who unveiled the new strategy in a press release. Good news, more models will now be eligible and this better matches current market realities.

So here’s the new reality for the federal government’s $5,000 grant:

  • A base model vehicle must have a manufacturer’s suggested retail price of less than $55,000. More expensive versions of these vehicles are also eligible, as long as the manufacturer’s suggested retail price does not exceed $65,000.
  • The base model of a larger zero-emission vehicle (eg minivan, pickup truck or SUV) must have a Manufacturer’s Suggested Retail Price of less than US$60,000. More expensive versions of these vehicles are also eligible, as long as the manufacturer’s suggested retail price does not exceed $70,000.
François-Philippe Champagne, Minister of Innovation, Science and Industry of Canada Photo courtesy of: Samuel Lessard

The objective behind this whole operation is to encourage consumers to go green. However, manufacturers will also have to step up the pace, as by 2026, sales of zero-emission light vehicles will have to account for 20% of the total number of products sold. This percentage will rise to 60% in 2030 and then 100% in 2035. For medium and heavy vehicles, the measure is a little more permissive, as only 35% of sales are directed in 2030. For this segment, zero emissions neutrality receives 5 – postponement of the year. After 2040, there will be no more exemptions. Unfortunately, to illustrate the entire lack of teeth, the government is careful to include in its press release that it will be as per the feasibility…

RPM NOTICE

The Government of Canada has sent its Environment and Industry heavyweights to the Montreal Electric Auto Show only to tell us that the $5,000 grant is extended until 2025 without saying any more. Funny strategy of entrusting the task of the announcement to the Minister of Transport who was not present. However, the important thing is that the Government of Canada expands the eligibility of vehicles to better respond to the reality of the market.

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