Canada is recalibrating its electric vehicle strategy on multiple fronts, reshaping both trade policy and domestic regulations. The January trade agreement with China is rippling through the country’s auto sector, placing electric vehicles at the centre of a broader effort to strengthen and diversify trade agreements with new and existing partners. As part of the deal, Canada has agreed to allow up to 49,000 Chinese-made EVs into the market annually at a 6.1% tariff rate, reversing last year’s 100% surtax. It also includes tariff relief for Canadian agricultural exports such as canola, underscoring the wider economic scope of the partnership.
In early February, the federal government also repealed the previous electric vehicle sales mandate that required all new car sales to be zero-emission by 2035.
Taken together, these decisions signal a realignment on how Canada is considering electrification, industrial competitiveness and affordability. For engaged women, who consistently rank cost of living and economic strength as top concerns, shifts in policy when it comes to EVs can have direct implications for household budgets, environmental concerns, jobs, and long-term prosperity for their families.
From mandate to flexibility
The former Electric Vehicle Availability Standard required 20% of new vehicle sales to be zero-emission by 2026 and 100% by 2035. On February 6, Prime Minister Mark Carney repealed that mandate, replacing it with tougher tailpipe emissions standards for 2027–2032 models. This was cited as providing manufacturers time to determine how they meet emission reduction targets while still producing internal combustion engine vehicles – as long as their overall emissions fall.
For automakers that had argued the initial EV mandate was misaligned with consumer demand and infrastructure readiness, the shift provides regulatory breathing room by “giving the industry the flexibility [on] how they achieve lower emissions, whether through plug-in hybrids, EVs, [or] more efficient ICE [internal-combustion engine] vehicles.” Carney said.
The government anticipates the revised system will result in 75% of new vehicle sales being electric by 2035 and 90% by 2040.
For households, the change reflects a broader policy adjustment toward balancing emissions reduction with economic realities. CPW research shows 90% of engaged women believe Canada’s energy policies should prioritize improving the cost of living, even as 84% say reducing emissions remains important.
Rebates return, with new conditions
Ottawa has launched a new $2.3 billion incentive program offering up to $5,000 for battery-electric vehicles and $2,500 for plug-in hybrids in 2026, with rebates declining annually until 2030. To qualify, vehicles must be priced under $50,000 and produced in countries where Canada has a free trade agreement, which excludes Chinese-made vehicles from receiving incentives.
Chinese EVs can enter the market at lower tariffs though, potentially increasing price competition. This layered policy structure mixing incentives and tariffs attempts to support domestic and allied production while expanding consumer options. The government has signaled plans to introduce a tradeable credit system that would reward companies manufacturing and investing in Canada, though details on timing and how the framework will operate have not yet been released, a move that could tie market access more directly to domestic production and job stability.
Now is Canada ready for electric vehicles?
The new EV strategy also includes $1.5 billion to expand charging infrastructure and a forthcoming electricity strategy intended to strengthen grid capacity. While Canada’s charging network continues to grow, access remains uneven particularly in multi-unit housing and rural communities. Long-term grid reliability will be essential as electrification expands.
Battery chemistry also matters. Many Chinese EV makers rely on lithium iron phosphate, or LFP, batteries, which are less costly, but generally offer lower energy density and weaker cold-weather performance than the nickel, manganese, and cobalt batteries more common in western markets. In Canadian winters, that can translate into the cars not working as well, making year-round reliability an important consideration alongside price.
For engaged women—who consistently rank affordability and reliability as top priorities—EV readiness will be judged less by policy ambition and more by real‑world outcomes: reliable grid infrastructure, affordable and abundant electricity, vehicles that perform in cold climates, meaningful consumer choice and long‑term stability.