Tesla has made small but significant adjustments to the pricing of its electric vehicles in Canada. Along with raising the price of the Model Y, the Model 3 has seen the same $1,000 price increase across all three trims.
These price hikes have pushed the base model of both vehicles beyond the maximum price threshold for Canada’s iZEV (Incentives for Zero-Emission Vehicles) rebate program, removing a key affordability incentive for buyers.
Updated Model 3 Pricing
The base price for the Tesla Model 3 Long Range Rear-Wheel Drive (RWD) now stands at $55,990, up from $54,990. This increase surpasses the iZEV rebate eligibility cap, which currently limits vehicle prices to $55,000 for base models. Previously, this trim barely qualified for the rebate at $54,990, making it a popular choice among Canadian EV buyers.
Other Model 3 trims have also seen a price increase. The Long Range All-Wheel Drive (AWD) is now priced at $60,990, also making it lose access to the rebate. Meanwhile the Performance has reached $70,990, but it did not previously qualify for the rebate.
Losing access to the $5,000 rebate may represent a significant financial hurdle for Canadian EV buyers. For many, this federal incentive was essential in bridging the price gap between electric and traditional internal combustion engine (ICE) vehicles.
Tesla has not provided a specific explanation for these price adjustments, but the increase could be attributed to broader economic pressures, in particular the recent dip in the exchange rate between the Canadian and US dollar.
As we told you earlier, the Model Y, another top-seller for Tesla in Canada, has similarly experienced a $1,000 price increase. The updated pricing also disqualifies the entry-level Model Y from the iZEV rebate, which had been a significant draw for customers.
The price increases, and subsequent loss of rebate eligibility, come at an interesting time. Just today the government announced the iZEV fund was nearly out of money, with only enough to last a few more weeks. With no more Tesla vehicles, the most popular EVs in Canada, eligible for the rebate, the funding will likely last until March 31, 2025, when the iZEV program was set to expire.
