Canada announces new $5,000 incentive for electric cars, Tesla vehicles excluded

As part of its new budget, the Canadian federal government has announced a new $5,000 incentive for electric cars that cost less than $45,000, however, it excludes Tesla vehicles.

Some Canadian provinces already have EV incentive programs but unlike the US, there has never been a federal program to reduce the cost of electric vehicles.

With the launch of their latest budget, the Canadian government has now announced a new $5,000 incentive program that is not yet completed.

Here’s the current language in the budget:

“To encourage more Canadians to buy zero-emission vehicles, Budget 2019 proposes to provide $300 million over three years, starting in 2019–20, to Transport Canada to introduce a new federal purchase incentive of up to $5,000 for electric battery or hydrogen fuel cell vehicles with a manufacturer’s suggested retail price of less than $45,000. Program details to follow.”

The $45,000 cut off point covers vehicles like the Nissan Leaf, Chevy Bolt EV, and Hyundai Ioniq Electric, but all of Tesla’s vehicles are excluded since the base Model 3 starts at $47,000 CAD.

Along with the direct incentive for some consumer electric vehicles, the budget also includes other initiatives like investments in charging infrastructure and a ZEV mandate — though it sounds like it will include “voluntary zero-emission vehicle sales targets”.

Here are the main points:

• To expand the network of zero-emission vehicle charging and refuelling stations, Budget 2019 proposes to build on previous investments by providing Natural Resources Canada with $130 million over five years, starting in 2019–20, to deploy new recharging and refuelling stations in workplaces, public parking spots, commercial and multi-unit residential buildings, and remote locations.
• Meeting the ambitious sales targets requires automakers to make sufficient models and numbers of zero-emission vehicles available for sale to meet Canadian needs. Budget 2019 proposes to provide $5 million over five years, starting in 2019–20 to Transport Canada to work with auto manufacturers to secure voluntary zero-emission vehicle sales targets to ensure that vehicle supply meets increased demand.
• To attract and support new high-quality, job-creating investments in zero-emission vehicle manufacturing in Canada, automotive manufacturers and parts suppliers can access funding through the Strategic Innovation Fund, which was recently provided $800 million in additional funding through the 2018 Fall Economic Statement.