The federal government has just shifted the Canadian automotive landscape into high gear with a massive $2.3 billion, five-year EV affordability program. Offering substantial rebates on Battery Electric Vehicles (BEVs), fuel-cell vehicles, and Plug-in Hybrids (PHEVs), the strategy arrives at a critical crossroads as the industry pivots from mandates to new emissions standards. While AutoTrader research shows that purchase sentiment has dipped for three consecutive years leading into 2025, this billion-dollar injection could be the spark needed to reignite consumer interest.
To break down what this means for your wallet and the future of the Canadian road, we sat down with Baris Akyurek, AutoTrader’s VP of Insights & Intelligence. With 68% of non-EV owners admitting that government incentives are the primary factor in their decision to go electric, Baris offers expert analysis on whether these rebates can overcome lingering concerns about range, charging infrastructure, and the impending arrival of Chinese EVs under new trade agreements. —Noa Nichol
AutoTrader research showed three consecutive years of declining purchase sentiment for EVs leading into 2025. Given the scale of this new $2.3B five-year program, do you believe these rebates are substantial enough to fundamentally reverse that trend and reignite consumer interest?
Each year, AutoTrader conducts its annual Electric Vehicles (EV) survey to get a pulse on consumer sentiment across the country. In 2025, our research showed that interest in purchasing an EV has declined for the third consecutive year.
The latest announcement presents a win for shoppers with significant impact potential for Canada’s EV industry. The announcement signals a shift in the current strategy at a time when the EV market has been stalling.
These incentives come at a crucial time for Canada’s EV industry and have the potential to play a critical role in influencing purchase decisions and reinvigorating adoption. With higher purchase cost, infrastructure availability and range anxiety being the top 3 concerns for those who say they don’t plan on purchasing an EV, addressing these concerns is expected to positively influence purchase intentions.
Your data indicates that 68% of non-EV owners would be influenced by government incentives. Beyond the actual dollar amount, how much of this influence is psychological—making shoppers feel like now is the “correct” time to buy before the five-year window closes?
Our data shows that government incentives play a key role in overall EV adoption. While 68% of non-EV owners say incentives would impact their purchase decision, 52% say incentives increase their confidence in buying an EV. At the same time, only 29% say they fully understand the available incentives.
While we can’t say for certain the psychology behind purchases, it’s likely incentives could motivate consumers who were already considering purchasing an EV.
The federal government is moving away from the ZEV mandate in favor of new emissions standards. From an insights perspective, does a carrot-heavy approach (incentives) rather than a stick-heavy approach (mandates) lead to a healthier, more sustainable used EV market on AutoTrader down the road?
Our data shows incentives influence consumer confidence and purchase consideration, while mandates impact long-term supply and inventory. A healthy used EV market is shaped by how these factors work together alongside affordability and availability.
Rigid mandates don’t help anyone. Shoppers face high upfront costs, dealers carry inventory and pricing risk, OEMs chase compliance over demand, and workers are left in limbo.
Once the demand and supply are more “natural” on the new car side, it should have a corresponding impact on the used car side with less volatile pricing and inventory availability. This is a healthy outcome for the EV market overall, both for used and new EVs.
With the recent trade agreement bringing Chinese EVs to Canada, how do you expect these high-tech, often lower-cost models to interact with the new federal rebates? Will they dominate the entry-level segment, or will established brands still hold the trust of the Canadian consumer?
These two recent announcements could have meaningful implications for the EV market. Based on what we’re seeing in the data, here’s what car shoppers should know
The Canada-China trade agreement will increase selection and could put downward pressure on prices over time, especially in the entry-level segment. With higher purchase cost being one of the top reasons for non-EV owners who would not consider buying an EV, having more competitive EV pricing will alleviate a major shopper concern and open the door for more EV adoption in Canada.
However, Chinese EVs are excluded from federal rebates, which changes the competitive equation. While Chinese EVs may attract attention on price and technology, established brands with rebate-eligible models will likely retain a trust advantage, particularly among mainstream Canadian shoppers.
It’s still early in the rollout of this Chinese EV trade agreement. While it’s expected to influence EV pricing over time, the immediate impact will likely be modest given initial volumes.
Even as EV prices have declined, upfront costs remain a massive hurdle. Is there a specific “magic number” or price ceiling where you see Canadian shoppers move from “just looking” on AutoTrader to actually visiting a dealership once an incentive is applied?
There isn’t a one-size-fits-all price point since affordability varies by shopper. Having tools that let Canadians search and filter by price helps bring clarity to the market and makes it easier to find an EV within their budget.
While the $2.3B addresses affordability, it doesn’t solve range anxiety or charging infrastructure gaps. Is there a risk that these incentives will pull buyers into the market who then face “buyer’s remorse” because the physical infrastructure hasn’t kept pace with the financial support?
That risk exists if affordability moves faster than infrastructure, but the government appears aware of that balance. While incentives address cost, range anxiety and charging access still remain top concerns.
That is why the federal government’s $1.5B investment in charging infrastructure is a crucial complement to these rebates. Incentives may bring more buyers into the market, but infrastructure investment is what ensures those buyers stay confident and satisfied long term.
The new strategy includes rebates for Plug-in Hybrids (PHEVs). Do you anticipate a surge in “transitional” buyers—those who aren’t ready for a full BEV but will jump at a PHEV now that the federal government has officially included them in this five-year affordability roadmap?
There is a growing trend of Hybrids amongst Canadians. In fact, on our marketplace, they’re the most sought after EV segment with nearly 3-in-5 survey intenders (62%) saying they would consider buying one (followed by 60% for PHEVs, and 50% for BEVs). With stable prices and growing inventory, Hybrids are a great middle ground for any Canadian looking for a greener vehicle option.
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