Canada’s electric vehicle (EV) market continued to contract in June 2025, with sales of zero-emission vehicles (ZEVs)—including fully electric and plug-in hybrids—falling 35.2 percent year-over-year to 14,090 units, according to Statistics Canada. This marks the fifth consecutive month of declining EV sales and the second quarter in a row of steep drops.
In contrast, overall new vehicle sales in Canada increased 6.2 percent to 177,313 units, leaving ZEVs with just a 7.9 percent market share, down sharply from nearly 20 percent in December 2024. Analysts attributed the downturn to the elimination of federal and provincial purchase incentives earlier this year. Ottawa ended the $5,000 iZEV incentive in January, while several provincial programs were either scaled back or temporarily paused.
Quebec, historically Canada’s largest EV market, cut its rebate from $7,000 to $4,000 before suspending it for two months, contributing to a 65 percent decline in battery electric vehicle sales in the province during the first quarter. Tesla, previously the country’s dominant EV brand, accounted for less than 10 percent of ZEV registrations by April 2025, down from nearly half of the market two years ago.
Provincial adoption rates showed an uneven pattern. British Columbia led with a 19.2 percent ZEV share in Q1 2025, though this was a decline from late 2024. Quebec’s share dropped from 42 percent in Q4 2024 to 14.8 percent, while Ontario held steadier at 7.3 percent. A brief rebound in Quebec occurred in April when incentives were temporarily reinstated, but the national market remains fragile.
The federal government has pledged to restore some form of incentive following the April election, but no timeline has been provided. Industry experts say the uncertainty is suppressing consumer demand, leaving automakers bracing for continued sluggish EV sales in Canada.