Canada confirms all new vehicles sold in 2035 must be electric

Company News

by Glenn Dyer

Canada has confirmed media reports that it will move ahead with new rules that will compel all new vehicles sold in 2035 to be electric-powered.

Canada revealed draft regulations a year ago that proposed regulations mandating that an increasing share of light-duty vehicle sales be electric over a nine-year timeline.

The final rules largely confirm this time horizon, which envisions at least 20% of all auto sales to be electric by 2026, and at least 60% by 2030. In 2035, Canada expects all new vehicle sales to be electric.

"This fulfills a major climate commitment from our climate plan," said Steven Guilbeault, Canada's Environment Minister, in a statement.

In the first quarter of this year, around 10% of Canadian car sales were EVs. In 2022, around 85,000 of the nearly 1.49 million cars sold in Canada were battery-powered EVs.

In the 11 months to last month, though, car sales had topped the 2022 figure, and battery-electric vehicle (B-EV) sales will be more than 300,000.

But sales interest is slowing due to the high cost of EVs, inflation, and the lack of practical EV versions of popular ICE (Internal Combustion Engine) powered vehicles like the Ford F-150, Canada's (and America’s) most popular vehicle.

Transportation presently accounts for 22% of Canadian greenhouse-gas emissions.

According to the new rules, 20% of all new car sales in 2026 will include battery-electric, hydrogen, and plug-in electric vehicles.

By 2030, that percentage will rise to 60%, and 100% in 2035.

“The total anticipated cost to consumers of zero-emissions vehicles and chargers will be $C24.5 billion over 25 years, but Canadians can expect to save $C33.9 billion in net energy costs,” media reports suggested.

Officials said the rules align with measures introduced in California and 10 other US states.

In April, the US Environmental Protection Agency proposed rules governing tailpipe emissions, which carmakers claim would see two-thirds of new vehicles sold in America be electric in 2032.

The UK, however, said in September it was delaying by five years a ban on new gas and diesel cars that was to take effect in 2030.

Canadian-based automakers (most of whom are offshoots of US giants like GM and Ford) warn that the targets set out by the Liberal government won't be achievable without "ambitious" government-led investments to deal with EV charging infrastructure and address affordability concerns among households.

Glenn Dyer

Glenn Dyer has been a finance journalist and TV producer for more than 40 years. He has worked at Maxwell Newton Publications, Queensland Newspapers, AAP, The Australian Financial Review, The Nine Network and Crikey.

Subscribe to our Daily Newsletter?

Would you like to receive our daily news to your inbox?