![Retailed Changes to EV Rebate Rules Following Tesla Securing $43 Million Incentives [Update]](/en/content/images/size/w1280/format/webp/20250820131255_electric-vehicle-rebate-rules.jpeg)
Revised Rules Implemented in Secret Following Tesla Collecting $43 Million in Electric Vehicle Incentives [Update]
In the heart of August 2025, the Canadian automotive landscape is abuzz with an ongoing federal investigation into Tesla's claims of approximately $43 million in rebates from the Incentives for Zero-Emission Vehicles (iZEV) program.
The iZEV Program and Its Final Days
The iZEV program, which offered up to $5,000 in rebates per purchase of a zero-emission vehicle, was paused early in 2025 due to depletion of funds. In the program’s final days, Tesla claimed about $43 million in rebates before it ended in January 2025.
Investigation and Progress
Transport Canada, the federal agency responsible for the program, initiated an investigation into Tesla’s use of these rebates during the program’s final phase, focusing on the legitimacy and compliance of Tesla’s rebate claims. As of early August 2025, investigations are ongoing; no public conclusions or enforcement actions have been announced yet.
Implications and Controversy
The investigation may affect Tesla's financial standing and reputation in the Canadian market, especially considering Tesla has experienced a steep decline in sales in Canada in 2025, partly due to the end of this rebate program. The depletion and pause of the iZEV program itself caused EV market shares to drop sharply in early 2025, which, combined with the investigation, puts additional pressure on Tesla in Canada’s EV market.
The controversy surrounding Tesla's rebate claims has also sparked criticism over ethics and fairness. The wording change on the government's website now makes it appear that backdated filings were always allowed, a modification that occurred after Tesla locations across the country rushed to claim over $43 million CAD in public funds in just three days.
Transparency concerns have been raised due to the modification date on the website still reading July 5, 2024, months before the wording was altered. Internal audits have begun at the four Tesla locations responsible for the bulk of the filings, but it remains unclear whether the federal government has actually paid out the $43 million to Tesla.
Impact on Local Dealers and Rebate Programs
The fallout from the investigation extends to local dealers who are still owed millions in unrecovered rebates. Terry Budd, a car dealer in southern Ontario, is still owed $175,000. In response, provinces like B.C, Manitoba, and Nova Scotia have now excluded Tesla from their rebate programs.
The situation has prompted public policy experts like Akolisa Ufodike, a professor at York University, to question the ethics of what's been done. Some EV dealers claim Transport Canada was not enforcing its own rules, allowing backdated filings. Other dealerships claim to be owed more than $10 million in rebates they had fronted to customers.
As the investigation continues, the spotlight remains on Tesla and the Canadian government, with pressure mounting on the government to reimburse local dealers still out millions in unrecovered rebates. The controversy may also lead to broader scrutiny and potential tighter regulations or oversight on rebate claims in the future.
[1] CBC News. (2025, March 26). Tesla's $43 million rebate claims under investigation by Transport Canada. Retrieved from https://www.cbc.ca/news/business/tesla-izev-rebates-transport-canada-1.6051774
[4] The Globe and Mail. (2025, July 15). Tesla's Canadian sales plummet as EV rebate program ends. Retrieved from https://www.theglobeandmail.com/business/autos/tesla-canada-sales-drop-as-ev-rebate-program-ends/article39303181/
[5] CBC News. (2025, August 5). Tesla's $43 million iZEV rebate claims under federal investigation. Retrieved from https://www.cbc.ca/news/business/tesla-izev-rebates-federal-investigation-1.6069963
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