Tesla is banned from Canada EV rebate program, gov freezes suspicous $43 million in rebates

Tesla has been banned from upcoming federal EV rebate programs in Canada as the government freezes the suspicious $43 million in rebates that Tesla claimed days before the program was paused earlier this year.

Earlier this month, it was reported that Tesla claimed $43 million in government rebates from the iZEV federal EV rebate program in Canada just a few days before the program was paused due to a lack of funds.

The move was suspicious as it would have required Tesla to deliver over 8,000 vehicles at just 4 locations on a weekend, which is physically impossible.

It is believed that Tesla preemptively filed for thousands of rebates after being made aware of the pause to ensure it wouldn’t run out in an anticipated surge in demand due to the program’s pause.

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However, this tactic proved problematic. The government told other car dealers who actually delivered EVs before the end of the program that they couldn’t get the rebates, which were already applied to the customer purchases, as Tesla took most of the money for vehicles it likely didn’t deliver.

Today, Chrystia Freeland, Canada’s new transport minister, confirmed that the funds have been frozen until it can investigate precisely what happened with Tesla’s rebates.

Furthermore, Freeland confirmed that Tesla will be banned from future federal rebates for electric vehicles. In this case, it has more to do with the trade war launched by President Trump, whose biggest political donor is Tesla CEO Elon Musk.

She said (via the Toronto Star):

No payments will be made until we are confident that the claims are valid. I also directed my department to change the eligibility criteria for future iZEV programs to ensure that Tesla vehicles will not be eligible for incentives so long as the illegitimate and illegal U.S. tariffs are imposed against Canada.

The federal government is following the same strategy as some provinces. British Columbia has recently banned Tesla products from its EV charger rebate. Nova Scotia just announced that it has excluded Tesla from its $2,000 rebate at the purchase of a new EV.

Quebec just relaunched its own EV incentive program today. It will come into effect next week, and so far, Tesla’s Model 3 and Model Y vehicles are still included in the list of eligible vehicles.

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