Thank you, Madam Chair, vice-chairs and members of the committee, for the opportunity to appear before you today.
I would like to begin by acknowledging that we are gathered on the traditional and unceded territory of the Algonquin Anishinabe people.
I am pleased to be here with colleagues from across the government to discuss the auto strategy that the Government of Canada announced and the approach we are taking to reduce emissions in the transportation sector while supporting jobs, investment and affordability for Canadians. While transportation is central to Canadians' daily lives and our economy, it is also one of the largest sources of greenhouse gases and air pollutant emissions. This gives us an opportunity.
The challenge before us is not whether change is coming to the auto sector—it is already under way globally—but how Canada manages that transition in a way that maintains the auto sector's competitiveness while enabling Canadian drivers to have access to the most innovative, affordable and clean vehicles and technologies possible.
At its core, this discussion is about practicality. Canadians expect environmental policies to deliver results in the real world, not just on paper. Canada's auto industry is grounded in a simple principle: Focus on outcomes that matter to Canadians while giving industry the flexibility it needs to succeed in a rapidly changing global market.
This means three things.
First, ensuring Canadians have access to clean, affordable transportation options.
Second, reducing emissions in real and measurable ways.
Third, supporting a competitive, resilient automotive sector that provides good jobs and reduces unnecessary red tape.
To this end, following extensive consultations, the Prime Minister announced in 2026 that we will repeal the electric vehicle availability standard and strengthen Canada's light-duty greenhouse gas performance standard for new vehicles and make them sovereign. This is not a retreat from climate ambition. It is a move toward a simpler, more coherent and more effective regulatory framework. By focusing on a performance-based standard, Canada is setting clear and achievable expectations for emissions reductions while remaining technology neutral. It is expected to drive increased zero-emissions vehicle sales as the standard becomes more stringent.
The outcome is clear: Emissions must come down. What remains flexible is how industry gets there. An informed and rational policy approach recognizes the need for increased flexibility for everyone, especially in the context of the current tariff situation and the price volatility of oil and gas, while still moving decisively toward lower emissions. Automakers will have flexibility in how they comply, whether through battery electric vehicles, hybrid technologies that include both plug-in hybrids and conventional hybrids and increasingly efficient internal combustion vehicles. What they cannot do is avoid reducing emissions further. This will be non-negotiable.
This approach sets Canada on a credible path toward approximately 75% electric vehicle sales by 2035, with an aspirational target of 90% by 2040.
It also increases flexibility for automakers while still positioning us to continue reducing emissions on a pathway to net zero by 2050. In short, it's a win-win.
As many of you know, Canada's auto sector employs nearly half a million people and contributes billions of dollars annually to our economy. At a time when the sector is facing global competition, trade pressures and rapid technological change, competitiveness matters and so does affordability. One in four new vehicles sold globally is now an electric vehicle, and that share is rising.
Many Canadians want cleaner, more efficient vehicles, but cost and practicality remain a consideration. That is why regulatory measures are being complemented by a broader national auto strategy developed in collaboration with Transport Canada, Natural Resources Canada and ISED in an effort to create supportive policies for consumers and industry. These include the renewal of federal purchase incentives of up to $5,000, investments to expand charging infrastructure and actions to increase access to a wider range of lower-cost electric vehicles.
Thank you. I look forward to the committee's questions.