EVwire brief: Canada’s new automotive strategy, launched by Prime Minister Mark Carney in Vaughan, Ontario, lays out major federal investments and policy shifts designed to accelerate EV adoption, expand charging infrastructure, support domestic EV manufacturing, and strengthen North American supply chains in a competitive global environment.
On February 5, 2026, Prime Minister Mark Carney unveiled a comprehensive strategy aimed at transforming Canada’s automotive industry and prioritizing electric vehicles as a cornerstone of future economic growth and climate action. Announced in Vaughan, Ontario, the plan signals a major shift in federal policy to boost EV adoption, support domestic production, and create a more competitive, resilient auto sector.
The strategy reflects Canada’s recognition that the future of both global and domestic automotive markets is electrified, connected, and low-emission. It aims to help Canada not just participate in the EV revolution but to have a major role in leading it.
Key components of the plan include:
Stronger Emissions Standards to Drive EV Sales
The government will introduce more stringent greenhouse gas tailpipe standards, intended to move Canada toward:
75% of all new vehicle sales being EVs by 2035, and
90% by 2040.
Officials say these standards will replace the previous Electric Vehicle Availability Standard, offering greater flexibility while still accelerating EV adoption.
A Five-Year EV Affordability Program
To make EVs more accessible, Ottawa will launch a $2.3-billion EV Affordability Program offering purchase or lease incentives for:
up to $5,000 for battery-electric and fuel-cell EVs, and
up to $2,500 for plug-in hybrids (PHEVs).
The price cap on eligible vehicles will be $50,000 CAD for most imports, but this cap is lifted for EVs built in Canada (aimed at supporting domestic manufacturing).
Massive Investment in EV Charging Infrastructure
The strategy commits $1.5 billion to expand Canada’s EV charging network via the Canada Infrastructure Bank’s Charging and Hydrogen Refueling Infrastructure Initiative. This is intended to help address range anxiety and enable long-distance electric travel across rural, northern, and urban corridors.
Major Investments in Automotive Manufacturing and Technology
Through tax incentives like the Productivity Super-Deduction and reduced corporate tax rates for zero-emission technology manufacturers, Canada aims to attract investment in next-generation EV and clean tech production. A $3-billion allocation from the Strategic Response Fund will also help domestic automakers adapt and diversify.
Worker Support and Workforce Development
The plan includes support for up to 66,000 Canadian auto workers through reskilling programs, employment assistance, work-sharing grants, and partnerships to ensure the workforce is ready to build and service EVs and other future vehicles.
“Canada’s new government is fundamentally transforming our economy – from one reliant on a single trade partner, to one that is stronger, more independent, and more resilient to global shocks. We are making strategic decisions and generational investments to build a strong Canadian auto sector, where Canadian workers build the cars of the future.”
The strategy also aims to make Canada less dependent on a single trade partner and more competitive globally. It preserves counter-tariffs on U.S. auto imports to protect domestic manufacturers and expands international partnerships which includes new agreements in China, to bring investment into EV supply chains and vehicle production.
You can learn more about Canada’s agreement with China here:
While I believe in the initiatives, I remain skeptical. They key considerations for EVs are being tackled here, High costs via targeted incentives; charging gaps via infrastructure investments, jobs via Canadian production, global competitiveness via trader partnership diversification BUT! Timing is everything. Are we too late to lead anything in the EV space? We all know that getting butts in EV seats increases EV adoption, so when will these incentives be available? And as Canadians look to bring production within the border, it will take years for manufacturing or assembly plants to be ready.
SOURCE: Government of Canada
