As the federal government mandates automakers to ensure 20 per cent of their inventory is electric vehicles by 2026, manufacturers are calling on Ottawa to cancel the order citing poor sales amid the impact of tariffs from the United States.
Brian Kingston, president of the Canadian Vehicle Manufacturers’ Association, says the automotive industry in Canada is under a great deal of pressure right now. He says there’s “no way” the industry can meet the targets set out by Ottawa while facing trade tariffs.
“The EV mandate is impossible to achieve,” Kingston told BNN Bloomberg Thursday. “Twenty per cent of EV sales in 2026; we just hit sales of 8.7 per cent last month. There is simply no way to close that gap and if this regulation stays in place, automakers will have no choice but to start restricting internal combustion engine vehicle sales in Canada by the hundreds of thousands. This will be devastating to the industry and dealerships across Canada.”
Kingston joined several auto industry executives in a meeting with Prime Minister Mark Carney on Wednesday to discuss trade tariffs while also urging the feds to get rid of the EV mandate. The mandate policy states that, as of next year, 20 per cent of all new light-duty vehicles sold in Canada must be zero-emission. That target rises annually to 100 per cent by 2035.Kingston says companies have made investments into the EV supply chain, but the demand is not there from consumers.
“These companies are committed to electrification,” said Kingston. “There are record numbers of EVs in the market. There are over 100 models now available in every size and segment. The challenge is the consumer demand is simply not there, and it has, in fact, been collapsing. Just to give you a sense of how big this gap is, an additional 180,000 EVs would need to be sold next year to hit that 20 per cent target. There is no way that is going to happen”.
The federal government’s zero-emission vehicle mandate is set to kick in next year. Automakers have expressed concern as electric vehicles remain more expensive than their gas-powered equivalents. Sales fell in the winter after the federal $5,000 vehicle rebates ran out of funding, the Canadian Press reported.
“We’re trying to transition into mass market adoption, so, think about your family with one vehicle that does a lot of driving. That’s a very different conversation, and that type of consumer has questions about charging infrastructure, vehicle range and, of course, price. And right now, we don’t have the infrastructure in place to hit mass adoption,” said Kingston.“We’ve got to get those preconditions right. Let’s work on building out the ecosystem. The consumer will come along. But if you mandate an arbitrary ratio, you’re setting the industry, and frankly, Canadians up for failure.”
The Canadian Vehicle Manufacturers Association represents Ford, General Motors and Stellantis. Members work together to achieve shared industry objectives on a range of important issues such as trade, consumer protection, the environment and vehicle safety, according to their website. Collectively, they operate five vehicle assembly, engine and components plants and more than 1,300 dealerships.
Between January and March, zero-emissions vehicles made up only 8.11 per cent of all new vehicle sales in Canada, a drop from the 16.5 per cent recorded in the fourth quarter of 2024, Statistics Canada data showed.
The monthly share of new vehicle sales going to EVs never dropped below 10.65 per cent in 2024 and peaked at 18.29 per cent in December.In April of 2025, the month for which Statistics Canada has the most recent data, EV sales dropped to 7.53 per cent of all new vehicle sales in Canada.
Kingston said automakers already comply with stringent emissions standards in Canada that require electrification. He said Canada needs to build out the infrastructure, help Canadians install home chargers, build up an electricity grid and make sure there is enough clean, affordable and reliable electricity across the country before mandating electric vehicles.
Kingston said that if automakers can’t meet the 2026 target, they’ll have to pull about one million gas-powered vehicles from the market to comply with the sales mandate.
“The mandate has to be repealed before it does massive damage to this industry and the Canadian economy,” says Kingston.
With files from the Canadian Press
