By on March 20, 2019

2017 Chevrolet Bolt - Image: Chevrolet

That headline was originally typed as “government cash,” except that wouldn’t be quite accurate, would it? Canada’s federal government tabled its budget Tuesday, and within those dry, dry pages was a helping hand for the struggling electric vehicle segment. While two of the country’s 10 provinces offer their own EV rebates (Ontario used to pony up a princely sum until a change in government last year saw the program kiboshed), there was never a federal program to stimulate the sale of green vehicles.

How does $5,000 pooled from your friends and neighbors sound? Good? Hold your horses, Tesla fans. You don’t apply.

Quite a few prospective EV buyers don’t apply, actually, as the upcoming program carries a vehicle price ceiling of $45,000. Cross-border price inflation means the cheapest Tesla — the Model 3 Standard Range — starts at $47,600. Booooooooo, said the online Tesla fan base.

Detractors might offer up a “cry me a river.”

From the budget:

To encourage more Canadians to buy zero-emission vehicles, Budget 2019 proposes to provide $300 million over three years, starting in 2019–20, to Transport Canada to introduce a new federal purchase incentive of up to $5,000 for electric battery or hydrogen fuel cell vehicles with a manufacturer’s suggested retail price of less than $45,000. Program details to follow.

Under the program, businesses and private contractors who purchase an EV, plug-in hybrid (with a battery larger than 15 kWh), or fuel cell vehicle are eligible for a full tax write-off in year one, assuming the vehicle costs less than $55,000:

Immediate expensing will apply to eligible vehicles purchased on or after March 19, 2019 and before January 1, 2024. Capital costs for eligible zero-emission passenger vehicles will be deductible up to a limit of $55,000 plus sales tax. This is higher than the capital cost limit of $30,000 plus sales tax that currently applies to passenger vehicles. This new $55,000 capital cost limit reflects the comparably higher cost of zero-emission vehicles and will be reviewed annually to ensure that it remains appropriate as market prices evolve over time.

What EVs qualify for the purchase incentive? It’s a short list. A base Chevrolet Bolt, supplies of which are paltry in Canada, slides under the limit by just $200. With 383 km (238 miles) of driving range, that’s the road tripper’s best bet, though this author saw several Twitter commenters complaining about the lack of government incentives for Bolts with more content and better paint. It’s all about concern for the environment, don’t you know.

Nissan’s lowliest Leaf starts at $40,698 and offers 242 km (151 miles) of driving range, though the not-yet-priced Leaf Plus (363 km) might not be on the list after Nissan assigns it an MSRP.

Hyundai’s Ioniq Electric, in both base and Ultimate trim, easily clears the pricing bar, with MSRPs of $37,449 and $42,449, respectively. However, choosing Hyundai nets you a range of just 200 km (124 miles), making it a less than ideal choice for those who regularly make road trips of an hour or more. The same goes for the Volkswagen e-Golf, which beats the Ioniq’s range by 1 km and carries a starting price of $36,720.

If range really isn’t a concern, you might notice that there’s still Smart stores attached to some Mercedes-Benz showrooms. In Canada, the EQ Smart ForTwo starts at $29,050 for the coupe version and $32,050 for the cabriolet, each offering a measly 93 km (58 miles) of driving range. Don’t bother looking for that info on the Smart website, though — it’s not even listed under the submenus of “Specifications” and, amazingly, “Range.”

While your author’s feelings about government incentives for electric vehicles are well known, at least there’s a price ceiling attached to the program. Meanwhile, all bad people owners of gasoline-powered vehicles who may not have alternate transportation options can look forward to a carbon tax that raises the price of gasoline on April 1st. The government needs the revenue.

[Images: General Motors, Nissan]

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24 Comments on “North of the Border, Taxpayer Cash Prepares to Flow to EV Buyers...”

  • avatar

    Note that you can have any colour you want on that Bolt, as long as it’s white. All other colours push you over the MSRP threshold.

    Personally, I think $45k is taking it too far to avoid the criticism that Ontario got for providing rebates on expensive cars.

  • avatar

    Another example of irresponsible spending. Rather than giving out freebies we should work on repaying our national debt (691 billion CA$ and counting). It would be nice if the word “No” was reintroduced in our vocabulary.

    • 0 avatar

      I agree with you that this program is unsound, and I am no fan of either the current Canadian government or the current US administration. But your mention of Canada’s national debt led me to make a comparison.

      On the assumption that you’re right about Canada’s national debt, it works out to about US$500 billion, while the projected deficit is about US$15 billion. If one does the usual 10x math, that is equivalent to the US having a national debt of $5 trillion and a deficit of $150 billion. In fact, the US national debt is $22 trillion and the deficit $1.2 trillion.

      So, Canada (which US right-wingers like to call “socialist”)is clearly doing a much better job of managing its national finances than the US is.

      • 0 avatar

        Except that Canadian provinces are allowed to have debt, so you can add provincial debt to the federal debt, perhaps doubling the total. (Pension plans are in much better shape in Canada, in contrast to the coming bankruptcy of Illinois.)

      • 0 avatar

        Canada has the population of a US state and has no real international presence or commitments

        what Canada does have, thanks to Maurice Strong, is some of the worst energy policies in the world – his policies are why Ontario is in such trouble

  • avatar

    Trudeau is trying to appease his voter base. The 5 K rebate will go over really well with the downtown Toronto/ Vancouver Liberal elites. The rest of us couldn’t give a —!

  • avatar

    I, for one, am glad the rebate is making a come back in Ontario. It is nowhere near as attractive as the $14000 rebate previously offered. If EV’s are the wave of the future, to succeed, manufacturers need to appeal to various demographics and income levels. Sadly though I won’t be an EV candidate for some time.

    • 0 avatar

      “If EV’s are the wave of the future..”

      Now cars dot com says the nearest new Bolt I could test drive is 680 miles away.

      I’m not feeling very railroaded into EVs.

  • avatar

    Yes there was a change in government in Ontario, the (Liberal) party went all the way from a ruling majority to one that technically was too small to even have party status.

    THIS was one of the big reasons why, taxpayer money from some people flowing to subsidize individual car purchases without thinking of people’s ability to buy themselves. So the country’s Liberal party is repeating the same error.

    • 0 avatar

      The world seems to be making a pretty big shift in Politics, and based off of what happened in Paris this weekend this movement is expanding quite rapidly.

    • 0 avatar

      Ontario went w/ Maurice Strong’s energy policy and now is saddled w/ an economic nightmare

      seems also that electric cars aren’t the best in cold climates to say the least

  • avatar

    Wouldn’t it be much more environmentally effective just to shut down the whole shale oil industry? Maybe put a $10 per gallon tax on gasoline to discourage the wrong kind of vehicle purchase and excessive driving, and give the money to all the laid off oil industry workers so they can learn to code.

    • 0 avatar

      Yes but the people who would be f*cked over by big structural changes like that get to vote.

    • 0 avatar
      Art Vandelay

      Lol…Learn to code. Oh look, you have no real experience but you know C# and Python? Cool, I’ll pay you 15 bucks an hour…until I can outsource you.

      Now if you know a real language (Think C or Assembly), that would change but you have to know things other than “how to code” to be effective with those languages.

      Also, make no illusions, you are on the bottom rung and will by far be the easiest to replace, so don’t screw up. Oh, BTW, I don’t need you to actually write much code, I need you to do some code review for the tools my real developers are writing or integrating from other sources.

      The Break room is over there. You get 30 minutes for lunch…Don’t microwave fish.

      I need developers, and they are paid well…not because they “Know how to code”, but because they know how to solve problems. Anyone with half a brain can learn a language fairly quickly. Using that language to create tools that effectively solve problems is another matter.

  • avatar
    DC Bruce

    As a non-Canadian, I guess I shouldn’t comment. But it does seem perverse that a country that is predominantly cold is spending its citizens’ money on a technology that works rather poorly in cold weather. Norway, I can understand. Virtually all of their electricity comes from hydropower, I believe, and most of the population is concentrated around a few cities. But, apart from Quebec, I don’t believe Canada is a hydropower “power,” and parts of the country are pretty thinly settled.

    • 0 avatar

      About a fifth of the entire population of Canada lives within 100km of Toronto – loop in the other handful of major cities, and we actually are pretty concentrated in urban areas. In addition, Ontario at least has a significant amount of low-emissions power sources (in addition to Quebec’s heavy use of Hydro). We’ve got a fair amount of hydro as well, and several nuclear plants as well (which, yes, have their own issues, but zero emissions).

      • 0 avatar

        Ontario has a nightmare system that produces some of the highest priced electricity in NA thanks to Maurice Strong

        Ontario is locked in to high-cost electricity supply, no matter what happens with Hydro One
        It’s a multi-decade mess in the making that won’t be solved quickly

    • 0 avatar

      Hydro power is substantial across Canada – lots in BC, Ontario – including Niagara Falls, Quebec, and a huge new project in Newfoundland.

    • 0 avatar

      @DC Bruce

      No need to guess about about hydropower and opine off the top of your head and thus get it completely wrong. Just Google it.

      59% of electricity in Canada is hydropower. Here’s the breakdown in a nice little pie chart:

      Hydro 59%
      Nuclear 15%
      Coal 9%
      Gas/oil/other 10%
      Non-hydro renewables 7%

      We also export a lot of electricity to the USA. There are two huge hydropower projects still building in Canada, way over budget as is the neoliberal wont these days. You know, topping up the wealthy’s empty pockets by excessive suckling at the government teat — just make your initial estimates completely wrong, something the military-industrial complex has perfected in the US to use up half your national federal budget to the detriment of everything else.

      As you say though, EVs are pretty useless in the cold. The exact same thing could be said of the Northern US, since the weather doesn’t change in crossing a man-made border line, despite US beliefs that it does much like your belief about hydropower.

      Right wing cackling on just about everything I tune out these days. We’re getting more of that dumb-sh*t thinking in Canada these days, with an antedeluvian ape running Ontario’s provincial government. Shooting oneself in the foot by electing these people is a popular sport these days. People love it.

      • 0 avatar

        Ontario power generation is a mess, driven by the policies initiated by Maurice Strong. The dumb sh*t happened under Liberal governance and Ontario will pay for decades

        Ontario’s soaring electricity costs result of poor government policies: report

        Ontario is locked in to high-cost electricity supply, no matter what happens with Hydro One
        It’s a multi-decade mess in the making that won’t be solved quickly

  • avatar

    It’s good to see there is at least some logic in avoiding millionaire buyers’ cars for rebates. The Hyundai Kona EV and Kia NIRO adnd Kia Soul will all qualify and they have dricing rnages greater than many of Tesla’s wildly overprices and poorly serviced and unreliable cars.

  • avatar

    if it’s like the previous Ontario rebate, the 45K limit is based on a base trim. So I imagine when they can, Tesla will drop the 3 to 44,999 just to qualify as the battery is considered an ‘option’. I imagine the Kona and Niro will drop their base price in Ontario, or the dealer will eat the ~1K just to make the sale.

  • avatar

    The price ceiling is too low. Essentially, this program guarantees a continued life for the short-range CARB compliance cars that should have been dying a natural death now that longer-range alternatives are available. Does anyone REALLY want a 58-124 mile range? No.

    If the government has decided that it’s a public policy priority to encourage EV sales, then they should simply copy the program of Ontario’s previous government: a credit large enough to erase the price difference between, say, a Corolla and a Bolt. And without throwing in a price cap to appease the bad-faith pearl-clutching of trolls who would have us believe that all electric car buyers are venture capitalists in six-figure Teslas.

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