Tesla has responded to mounting scrutiny in Canada over an unusual spike in electric vehicle sales that coincided with the end of the country’s federal EV rebate program. The company is under investigation after four of its stores reportedly sold 8,653 vehicles over a three-day period in March, triggering claims for approximately C$43.1 million (US$30 million) in government incentives.
The volume of sales—averaging 30 vehicles per hour at each location, 24 hours a day, even during closing hours—has raised questions among critics and officials about the legitimacy of the transactions. Some have accused Tesla of attempting to exploit the rebate system.
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According to a letter obtained by Electrek, dated March 28, Tesla’s director of sales and service for Canada, Fereshteh Zeineddin, denied any wrongdoing. Zeineddin wrote that many of the claims were for vehicles already sold, but whose rebate filings had been delayed. Tesla said the sudden surge in activity reflected a push to process a backlog of applications before the program ended, rather than any fraudulent activity.
Tesla also emphasized that the rebates did not represent direct financial benefit to the company. Under the program, the discount was passed on to customers at the point of sale, with dealerships later reimbursed by the government. In the same letter, Tesla criticized Transport Canada’s decision to freeze the rebates, arguing that the move had led to verbal abuse and harassment of its employees by the public.
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Transport Minister Chrystia Freeland defended the pause in payments, telling the Toronto Star that the freeze was necessary “in order to fully examine each claim individually and determine whether all are eligible and valid.” Tesla warned that it may pursue legal action if the payments are not resumed.
While the outcome of the investigation remains unclear, the timing and scale of the rebate claims have drawn significant attention. The National Post reported a 70% drop in Tesla deliveries in Canada between December 2024 and January 2025, making the spike in March appear particularly unusual.
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The situation has been further complicated by recent comments from Tesla CEO Elon Musk. Despite holding Canadian citizenship, Musk recently posted on X that “Canada is not a real country,” in response to a remark by Donald Trump suggesting the U.S. could annex Canada. While the comment was likely made in jest, it has added another layer of tension between Tesla and Canadian authorities.