By Canadian Press

Federal rebate set to make electric cars more affordable see $100M go to Tesla buyers

May 25, 2021 | 9:20 AM

OTTAWA — Transport Canada is looking at ways to include used vehicles in a federal rebate for electric cars — something observers say is needed to make the program more relevant to low or middle-income consumers, rather than only those able to buy brand new. 

Their recommendation comes while a new analysis also shows more than $100 million of the almost $300 million in subsidies issued so far have gone to Tesla drivers.

The program offers buyers an upfront discount of up to either $5,000 or $2,500 and sellers then have to claim the incentives to be reimbursed.

Government agreements show Tesla has been reimbursed around $102 million of the roughly $296 million sent to individual dealerships selling electric vehicles from at least 15 different automakers. 

Transport Canada says that purchases of the Tesla Model 3 represent only around 25 per cent of the total program claims.

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Montreal Economic Institute senior associate researcher Germain Belzile says such subsidies are an expensive, inefficient way to reduce transportation pollution compared to charging a higher carbon price on fuel.

Global Automakers of Canada President David Adams says the program’s affordability is going to become an issue as Ottawa has to decide how much money it’s willing to spend to reach its goal to get 10 per cent of all light-duty cars being electric by 2025.

Clean Energy Canada says to better reach Canadians who have less money, the rebates should include used vehicles, and Ottawa should consider introducing an income cap to weed out those who don’t need financial support to buy an electric car. 

This report by The Canadian Press was first published May 25, 2021.

Stephanie Taylor, The Canadian Press