Quebec to phase out EV rebates

Quebec will remove rebates for electric vehicles and plug-in hybrid vehicles by 2027.

The provincial government said that they no longer need to incentivize buyers to buy zero-emission vehicles in a budget announcement last week. When introduced in 2012, the incentive “was necessary to begin the electrification of the vehicle fleet in Quebec at a time when there were few models available, with more limited capacity, and when the charging network was emerging.”

According to the government, there are 240,000 EVs on Quebec roads. One in five new vehicle registrations in Quebec in 2023 were ZEVs.

Incentives for new EVs and fuel cell vehicles will drop from $7,000 this year to $4,000 next year and $2,000 in 2026 and unavailable in 2027.

Plug-in hybrids will see incentives go from $5,000 to $2,000 to $1,000 before being eliminated.

Used fully electrics will drop from $3,500 now to $2,000 next year and $1,000 in 2026 before no longer being available the following year.

The $600 home charging incentive will remain available into 2027.

In 2022, the government reduced the incentive from $8,000.

According to the Montreal Gazette, electric vehicle rebates cost the government $228 million in 2022-23, residential charging stations another $10.9 million and multi-dwelling charging stations $7.5 million.

Dealers concerned

The Canadian Automobile Dealers Association expressed “its deep concern” over the government’s decision in its budget and is calling on the province to reconsider the move.

“This decision comes at a time when Quebecers are facing a major affordability crisis, making purchase rebates absolutely necessary for the eventual attainment of the ZEV standard imposed by this same government,” its statement said.

At an event in the fall, Brian Kingston, president and CEO of the Canadian Vehicle Manufacturers’ Association, said one of the keys to a successful EV transition was to have better purchase incentives.

“You’re not going to shift a large portion of Canadians into an electric at a higher price point on the basis and the promise that they’ll save more money on gas,” he said at the Canadian Black Book TalkAuto 2023 event.

The CADA warned that the removal of the incentives could cause significant slowdowns in the progress Quebec residents have made in adopting EVs.

“The data also demonstrates that the fundamental reason behind Quebec’s success in this transition to electric is the usage of this aggressive and comprehensive incentive program,” it noted, adding that the two leading provinces in EV adoption — Quebec and British Columbia — are the only regions offering financial incentives on top of offerings from the federal government.

They also pushed back against comments made by Quebec Finance Minister Eric Girard that price gaps between EVs and ICE vehicles are marginal, noting that price parity wouldn’t be achieved until 2033.

“This budget proposes to turn back the clock by putting forward an approach similar to that of provinces that have barely begun the transition to electric vehicles,” the statement said. “Essentially, this decision seems to mean that the Quebec government, with its restrictive, mandatory ZEV standard, inevitably expects a transition, and that helping consumers to take part in it is no longer a priority.”