Canada Pauses 2026 EV Mandate, Launches Buy Canadian Policy

Canadian Prime Minister Mark Carney has announced a pause on the 2026 electric vehicle (EV) sales mandate requiring 20% of new vehicle sales to be zero-emission, initiating a 60-day review to introduce flexibility and reduce compliance costs amid economic pressures and U.S. tariffs imposed by President Donald Trump. This decision aims to balance Canada's environmental goals with industrial realities, recognizing challenges such as slow EV adoption, infrastructure readiness, and the impact of tariffs on the automotive sector, which supports jobs and trade in Canada. While the 2026 target is suspended, longer-term goals of 60% zero-emission vehicle sales by 2030 and 100% by 2035 remain intact. Alongside the pause, Carney introduced a new "Buy Canadian" policy requiring federal institutions to prioritize domestic suppliers by 2026 and created a $5 billion Strategic Response Fund to help businesses adapt to tariff impacts. Critics argue the move reflects the mandate's impracticality and high costs, but the government maintains that zero-emission vehicles are essential for climate change mitigation and economic opportunity. Carney emphasized that this adjusted approach is necessary to strengthen Canada’s industrial resilience amid trade disruptions without abandoning the commitment to net-zero emissions by 2050.