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Ottawa to reimburse auto dealers on hook for $11 million in unpaid EV rebates

CANADA, JUL 10 – The government will reimburse up to $11 million to Canadian dealers after Tesla’s surge in rebate claims depleted the $43 million Incentives for Zero-Emission Vehicles fund.

  • The federal government announced plans to reimburse Canadian auto dealers for about $11 million in unpaid EV rebates after suspending the iZEV program in January 2025.
  • The iZEV program was abruptly halted after Tesla submitted rebate claims exceeding $43 million for 8,600 vehicles over a single weekend just before the fund ran dry.
  • An investigation led by Transport Minister Chrystia Freeland froze payments to Tesla to verify claims, ultimately clearing Tesla of wrongdoing as claims represented legitimate sales before January 12.
  • Freeland stated that Tesla’s claims would be reviewed individually, and a spokeswoman said they are exploring ways to reintroduce purchase incentives worth up to $5,000 supporting Canadian workers and supply chains.
  • The reimbursement and program restoration aim to aid dealerships suffering from sales declines since the program’s pause and address industry calls to focus incentives on vehicles made or assembled in Canada.
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Millions of dollars in Tesla EV rebate claims were legitimate, Ottawa says

OTTAWA — Tesla legitimately claimed thousands of electric vehicle rebates in the final weekend before the department suspended its rebate program in January, Transport Canada said on Friday.

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Tesla legitimately claimed thousands of electric vehicle rebates during the last weekend prior to the Department's suspension of the rebate program in January," said Transport Canada on Friday.

·Montreal, Canada
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The Toronto Star broke the news in Toronto, Canada on Wednesday, July 9, 2025.
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