Government knew EV rebates could end months before notifying the public, documents show

Documents reveal that iZEV could run out months before public notice, leading to an abrupt pause in 2025 and market impacts.

Documents obtained by The Canadian Press show that, as early as November 2024, Transport Canada was aware that funding for the iZEV incentive for zero-emission vehicles could run out between the end of December 2024 and early January 2025.

Despite this indication, the first public notice only came on January 10, 2025, signaling that iZEV would likely pause before the originally scheduled end date of March 31, 2025.

What actually happened

Three days after the notice, the program was halted after receiving millions of dollars in claims over a weekend, with the majority coming from Tesla.

Before that, there was a strategy in development to announce the pause as early as December 2024, with the expectation of having at least CAD 150 million remaining to inform the public; however, the planning only truly took shape in January 2025.

How this affected the market

Between October and December 2024, demand grew, partly due to the change in Quebec's program, leading to a rush for rewards. In December, over CAD 122 million in claims were paid.

Dealerships were left with outstanding bills and customers believing the incentives would return, which helped sustain sales until the interruption. The delayed communication was the target of public criticism preceding other government programs.

What changed afterward and what is coming

The government eventually reinstated the incentives in early 2026, with updated rules: CAD 5,000 for 100% electric vehicles and CAD 2,500 for plug-in hybrids, with an annual reduction until 2030 or until funds run out.

Minister Steven MacKinnon stated that the new program will be monitored to avoid abrupt interruptions, ensuring pre-approval and information flow with dealership networks.

The return occurred a few months after the market cooled down: monthly EV sales dropped from 18% of the total in December 2024 to less than 7% in February 2025.

Where everything connects

• Program period: 2019 to 2025
• Rebates: between CAD 2,500 and CAD 5,000
• Maximum eligible price: approximately CAD 55,000
• Claims in one weekend: hundreds of millions, with Tesla alone responsible for a large part
• Fund diversion: CAD 70 million from iMHZEV to extend iZEV
• Decline in EV sales: from 18% to below 7% between December 2024 and February 2025

This report by The Canadian Press was originally published on February 26, 2026.

Now, with the return of incentives, it remains to be seen how the new system impacts dealerships and buyers. What do you think this reinstatement could mean for the EV market next year?

Leave your comment below with your opinions on public communication and the impact on your plans to purchase an electric vehicle.