Feds might be flexible on ZEV mandate after meeting with Canadian dealers association

The federal government is not budging on its plan to mandate the sale of zero-emission vehicles starting in 2026, but after months of dialogue with industry, is showing some willingness to build flexibility into the sales requirements, according to the Canadian Automobile Dealers Association.

CADA officials, joined by a number of local dealers, met Minister of Environment and Climate Change Steven Guilbeault in Montreal in August.

During the meeting, which CADA Public Affairs Director Huw Williams described as “one of the more productive” the organization has had with the federal government since the mandate was first floated, the dealers walked Guilbeault and senior staff through the current challenges in the electric vehicle market, and made suggestions about ways to smooth the transition.

“The government’s been crystal clear on the direction of the mandate and don’t seem to be moving off that at all. What we’re talking about now is whether there’s flexibilities that are built in that are smart,” Williams told Automotive News Canada.

Kaitlin Power, press secretary for Guilbeault, confirmed the meeting, saying it is one in a series of discussions the ministry has held with auto industry representatives and ZEV advocates on Ottawa’s planned ZEV mandate.

“All feedback provided to the minister from the draft regulation is being considered,” she wrote in an email to Automotive News Canada, without delving into what changes the final legislation may bring.

Environment and Climate Change Canada shared plans in March 2022 to mandate that all new light-duty vehicles sold in the country be zero-emission by 2035, and published draft regulations for public comment Dec. 31. The rules will require ZEVs account for 20 per cent of automaker sales by 2026, stepping up incrementally to 100 per cent by 2035.

At the outset, CADA encouraged Ottawa to slow the implementation of the mandate, or scrap it outright, but it is now focused on having government build in greater support for infrastructure and dealers, Williams said.

“It’s not good for the government’s mandate and it’s not good for dealers to push the targets so far and so fast that consumers can’t adapt.”

During the August meeting, Williams said Guilbeault “heard us out on flexibility,” including avenues to support dealers installing costly EV infrastructure and possibly removing the newly enacted luxury tax on ZEVs to better encourage adoption.

Power said Ottawa is working “across departments to ensure the success” of ZEVs. The federal consumer incentive program, charging infrastructure funding and billions in support for electric vehicle and battery manufacturing all feed into the wider goal, she added.

Ottawa plans to publish the final version of its ZEV mandate regulations this year.

“We are working our way through internal processes in preparation,” Power said.