Federal government to invest $287M in ZEV program
December 7th, 2020
The federal government announced its fall economic statement for 2020 on November 30, and offered a few highlights for the automotive industry that CADA has been advocating for as part of a recovery plan, according to Oumar Dicko, Chief Economist at CADA.
“There was some good news in the statement — one of them being the allocation of $287 million over the next three fiscal years as a top-up to the ZEV program,” said Dicko in an interview with CADA Newsline. “For CADA, and for our dealer members, this is a positive step forward, as we advocated for the government to allocate more funding to this successful program.”
There was no official announcement, but CADA found the information in the plan and verified it with the federal government. The plan also includes millions of dollars worth of investment into ZEV infrastructure, spread across the same timeframe.
“There is also $150 million over three years for ZEV infrastructure across the country, which is key to ZEV proliferation in Canada and one of the recommendations from the association in the lead up to the announcement,” said Dicko. “Those ZEV targets announced by government last year need to be supported by proper network of infrastructure.”
He said the funding is a step in the right direction, and CADA is pleased it is being provided to the program.
During the announcement, Chrystia Freeland, Deputy Prime Minister and Minister of Finance said the plan is to ensure the Canadian economy emerges from the pandemic “greener, more inclusive, more innovative, and more competitive than the one that preceded it, with a stronger, more resilient middle class.”
The last highlight for the auto industry is the allocation of $100 billion for the post-pandemic stimulus, equivalent to approximately 3-4 per cent of GDP over three years invested in the package.
“We’re pleased that the government is thinking about the recovery, while still supporting the economy during the crisis,” said Dicko. “It is our hope that some of this post-pandemic stimulus will be destined to boost demand and incentivize vehicle purchase post-crisis — perhaps to fund a national vehicle scrappage program to green the Canadian fleet.”
CADA has been advocating for a national scrappage program to help incentivize new vehicle purchases that are more fuel efficient.
The association has also come out against a proposed luxury tax by the federal government, and was pleased to discover that no such tax was included in the announcement as part of the fall economic statement.
“As the market continues to recover in Canada, vehicle sales remain significantly down and a luxury tax would further impact it,” said Dicko. “So the lack of any mention about the tax is more good news for dealers.”