Canada Halts Tesla EV Rebate Payments Amid Trade Tensions

Canada has ceased all rebate payments to Tesla Inc. TSLA and has excluded the company from future electric vehicle (EV) rebate programs. This action is a direct response to U.S. tariffs affecting Canadian trade.

Government Response to U.S. Tariffs

Transport Minister Chrystia Freeland made the announcement, stating that the suspension of rebates will continue until each claim is individually reviewed and confirmed. She noted, “I also directed my department to change the eligibility criteria for future iZEV programs to ensure that Tesla vehicles will not be eligible for incentive programs as long as the illegitimate and illegal U.S. tariffs are imposed against Canada,” as reported by the Toronto Star.

This suspension involves payments totaling approximately C$43 million (around $30.11 million). The announcement came ahead of Canadian Prime Minister Mark Carney‘s call for a general election scheduled for April 28. Earlier this month, the same publication revealed that a Tesla dealership in Quebec City had secured nearly C$20 million in public subsidies by claiming over 4,000 electric vehicle sales in a single weekend.

Note that Toronto had earlier discontinued financial incentives for Tesla vehicles used as taxis or ride-hAIL services due to rising trade tensions with the U.S.

Context on Exclusion from Programs

This recent decision follows Nova Scotia’s similar exclusion of Tesla from its EV rebate program. The Progressive Conservative government, alongside the NDP and Liberal opposition parties, voted unanimously to eliminate incentives for Tesla vehicles. Freeland’s exclusion of Tesla from future federal rebates aligns with the actions taken by various provinces, largely motivated by concerns over CEO Elon Musk‘s comments regarding Canada and trade tariffs.

Tesla had previously been the largest beneficiary of Canadian EV rebates, receiving C$713 million (approximately $499.9 million) since 2019. However, suspicions of misuse of the rebate program began to surface.

Industry Insights and Market Impact

Flavio Volpe, president of Canada’s Automotive Parts Manufacturers’ Association, expressed concerns, stating, “Tesla exploited the iZEV program by sneaking in its Shanghai-built product to soak up Canada incentives while its CEO declared ‘Canada is not a real country’ on X. Sounds like they made their bed.”

Consequently, Tesla’s exclusion from Canadian EV rebate programs could significantly hinder the company’s sales and market presence in the region.

As of now, Tesla boasts a momentum rating of 91.70% and a growth rating of 67.88%, according to Benzinga’s Proprietary Edge Rankings. These metrics assess a stock’s historical earnings and revenue growth across multiple time frames. For more detailed insights on stocks and growth opportunities, you may sign up for Benzinga Edge.

Tesla stock rose 3.45% on Tuesday, closing at $287.99. However, it has seen a decline of over 24% year-to-date.

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Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.