Canada’s zero-emission vehicle (ZEV) market is accelerating rapidly following the return of Canada’s federal EV rebate program, with March sales posting one of the biggest year-over-year increases in recent memory.
New data from Statistics Canada published on Friday shows Canadians purchased 21,574 zero-emission vehicles (ZEVs) in March 2026, a massive 74.7% increase compared to March 2025. The surge came even as overall new vehicle sales in Canada fell 6.6% year-over-year, highlighting how strongly buyers are gravitating toward electric and plug-in hybrid vehicles.
The jump in sales was likely driven by the relaunch of the federal Electric Vehicle Affordability Program (EVAP), which returned in mid-February offering rebates of up to $5,000 on eligible battery-electric vehicles and up to $2,500 on plug-in hybrids.
Even though the incentive was only available for part of February, ZEV sales still jumped 47% that month, suggesting many buyers had been waiting for the rebates to return before placing orders.
With March marking the first full month of the renewed incentive program, the impact only increased. ZEVs accounted for 12.2% of all new vehicle sales in Canada in March, nearly doubling their market share from 6.5% one year earlier.
Rising fuel prices are also likely adding momentum to the shift toward electrified vehicles. Gas prices across Canada are now approaching record highs, with prices above $2.20 per litre in some regions, making EV ownership increasingly attractive.
Despite the strong growth, Canada’s EV market still remains below its all-time highs. Back in September 2024, Canada recorded more than 30,000 ZEV sales in a single month. However, with rebates now locked in through 2031 and fuel prices expected to rise even higher during the summer months, Canada’s ZEV market may be entering another major growth phase.
That previous record could be within reach. The latest sales figures come before Tesla has begun large-scale deliveries of its new Model 3 Premium Rear-Wheel Drive (RWD). Priced at just $39,490, sales could be even higher in June, when deliveries are expected to ramp up in earnest.
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