Automakers can meet Canada’s 2035 EV sales goals, but with a 100 to 105 g/mile vehicle emissions target by 2030
Canada’s auto industry could hit a proposed 2030 vehicle emissions target largely by staying the course — but a stronger target is also achievable and would put Canada on a more credible path to 75% electric vehicle (EV) sales by 2035.
Regulatory changes
In 2026, the federal government proposed changing its approach under its vehicle emissions standard (VES) by repealing the EV sales mandates and replacing it with a more technology neutral approach. The regulation is expected to establish fleet-wide emissions performance standards, but these standards have yet to be released.
The goal of the regulation amendment is to achieve 75% EV sales by 2035. Canada has also committed to reducing its greenhouse emissions by 45–50% below 2005 levels by 2035.
120 g/mile
The federal government has indicated that the Canadian emission targets could start at 170 grams of carbon dioxide equivalent per mile travelled (g/mile) in 2027 and decline to 74 g/mile by 2035, with an interim 2030 target of 120 g/mile.
100 to 105 g/mile
Modelling we did earlier this year found that reducing light-duty vehicle emissions to achieve Canada’s emissions and EV sales targets by 2035 would require an interim 2030 target of 100 to 105 g/mile.
What we looked at
In this analysis, we examined whether Canada’s auto industry can
- comply with the emissions trajectory of 120 g/mile by 2030
- meet a stronger VES of 100 to 105 g/mile by 2030
Key findings
- A 120 g/mile target could be met under business-as-usual conditions, with EVs reaching about 30% of new vehicle sales by 2030.
- A stronger 100 to 105 g/mile target is also achievable by increasing EV sales to about 35%, shifting more towards cars, or a combination of both.
- A stronger standard would give automakers a greater incentive to make more EV models available in Canada, supporting greater consumer choice and helping Canada keep pace with the increasingly electrified global vehicle market.
A stronger target is within reach
A vehicle emissions standard sets annual greenhouse gas emissions targets for each automaker’s new light-duty vehicle fleet. The federal government is updating the standard, including new emissions targets. Automakers have flexibility in how they meet these targets, including through fuel efficiency improvements, hybrid and EV sales, changes in the mix of vehicles they sell and available compliance flexibilities and credits.
Our analysis shows that automakers can reach 100 to 105 g/mile by 2030 through realistic changes already underway in the markets.
Increase EV sales
Rasing EVs from 30% to 35% of new vehicle sales would bring fleet-wide emissions to about 105 g/mile by 2030, even if the current mix of cars and light trucks remains unchanged.
Sell more cars
Cars generally emit less than light trucks and SUVs, so shifting sales from 15% to 30% cars (with EV share steady at 30%) would bring emissions to about 102 g/mile.
Combine both approaches
Raising EV sales to 35% while also shifting towards more cars would push emissions below 100 g/mile by 2030.
Frequently asked questions
What is Canada’s vehicle emissions standard?
Canada’s vehicle emissions standard sets annual greenhouse gas emissions targets for each automaker’s new light-duty vehicle fleet. It regulates the average emissions of the fleet, not every vehicle sold.
What VES target can Canada achieve by 2030?
Our analysis finds that Canada’s auto industry can achieve 100 to 105 grams of carbon dioxide equivalent per mile (g/mile) by 2030 through modest changes in EV sales, vehicle mix, or both.
Can automakers meet a strong vehicle emissions standard?
Yes. Automakers could reach about 105 g/mile by increasing EV sales to about 35% of new vehicle sales, or about 102 g/mile by increasing car sales from 15% to 30% while holding EV share steady.
How can a stronger VES help Canadians find more affordable EVs?
A stronger VES would give automakers a greater incentive to make more EV models available in Canada. Greater availability and competition can help expand consumer choice and make EVs more affordable.
Can EVs help protect drivers from unpredictable gas prices?
Yes. EV drivers are less exposed to gasoline price fluctuations because they use electricity instead of gasoline to power their vehicles. Electricity costs are more predictable than gasoline prices, which change quickly in response to global oil prices and other market disruptions.
Why does Canada need a stronger vehicle emissions standard?
A stronger target pushes automakers to offer more lower-emitting vehicles in Canada, expanding consumer choice, spurring competition, and supporting Canada’s 2035 twin goals of reaching 75% EV sales and reducing greenhouse gas emissions by 45–50% below 2005 levels.
What happens if an automaker cannot meet the standard?
The VES includes compliance mechanisms that give automakers flexibility in meeting their emissions targets. These include using compliance credits, including credits purchased from companies that exceed the standard.
Download the full analysis above.
