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Canada Announces National Automotive Strategy & Chinese EV Import Quotas

Blog Feb 09th, 2026
Canada's Automotive Strategy and Chinese EV Import Quotas

February 6, 2025

The Government of Canada announced a new national automotive strategy on February 5, 2026. This follows an announcement on Canada’s position regarding Chinese EV import quotas on January 17, 2026:

  • EVAP Electric Vehicle Affordability Program – EV Consumer Incentives & Rebates
  • Chinese EV Imports
  • EV Production & Sales Mandates
  • Domestic Automotive Sector Support

Canada - EVAP EV Consumer Incentives & Rebates

Canada offers a new $2.3 billion EVAP Electric Vehicle Affordability Program. The fund provides consumer incentives and rebates for five years through 2030.

Program Date: February 16, 2026 through 2030 (end date to be announced)

Eligible EV Vehicles

  • EVs manufactured in Canada qualify - no cap or threshold on the transaction price
  • EVs made by countries where Canada has a current or future free‑trade agreement qualify – with vehicle transaction values in effect:
  • $50,000 final transaction value or below qualify
  • See vehicle inventory

Canada currently has free‑trade agreements with:

  • United States and Mexico - CUSMA agreement
  • Australia, Chile, Japan, Mexico, New Zealand, Vietnam and others - CPTPP agreement
  • All European Union member states - CETA agreement
  • United Kingdom - TCA agreement
  • South Korea - CKFTA agreement

Incentives & EV Rebate Amounts

  • up to $5,000 rebate for battery electric BEV vehicles in 2026 (purchase or lease)
  • up to $2,500 rebate for plug‑in hybrid PHEV vehicles in 2026 (purchase or lease)
  • rebate amounts will decline annually where in 2030, there will be a $2,000 incentive for BEVs and a $1,000 incentive for PHEVs

Canada - Chinese EV Imports

Canada provides import guidelines on Chinese‑made EVs to manage the entry of Chinese EVs into Canada. Canada continues to work with Chinese auto makers on vehicle certifications and Canadian motor vehicle safety standards.

Import Quotas

  • 49,000 Chinese‑made EVs per year at a most‑favoured‑nation MFN tariff rate of 6.1%
  • Increasing quotas over five years to 70,000 Chinese‑made EVs per year in 2030
  • The China‑specific quota reserved for affordable EVs targets an imported landing cost of $35,000 CAD or less, reaching 50% of the import quota by 2030

Canada – EV Production & Sales Mandates

Canada repeals the Electric Vehicle Availability Standard ZEV Mandate. In its place, Canada introduces new and more stringent GHG greenhouse gas emission standards:

  • Applies to 2027‑2032 MY model‑year vehicles
  • Adjusted EV production and sales targets 75% EV sales by 2035 and 90% EV sales by 2040 to reduce our carbon footprint

Canada - Domestic Automotive Sector Support

Canada outlines support to grow Canada’s domestic auto sector:

  • $3 billion CAD from the Strategic Response Fund and up to $100 million CAD from the Regional Tariff Response Initiative to help the auto industry adapt, grow, and diversify to new markets
  • $1.5B CAD from the Canada Infrastructure Bank’s Charging and Hydrogen Refueling Infrastructure Initiative to expand EV electric charging infrastructure
  • Automotive counter‑tariffs on auto imports from the United States to ensure a level playing field for Canadian automakers – consultations ongoing to create a system where vehicle manufacturers earn import credits through production and investment in Canada:
    - companies with surplus credits could sell them to those seeking to import vehicles to Canada
    - recognize Canadian content, job creation, and EV production
NewRoads Toyota NewmarketBlogCanada Announces National Automotive Strategy & Chinese EV Import Quotas