Industry and Technology Committee on March 12th, 2026

[The Chair, Liberal, Ben Carr]

Good morning, everybody.

Welcome to the House of Commons Standing Committee on Industry and Technology.

Welcome, everyone. I hope you're having a good week so far.

I will begin by letting witnesses who are joining us here in the room know that, when the translation earpiece is not in use, they should place it on the sticker in front of them to protect the health and well-being of our translators.

I want to inform the committee that all the witnesses have completed the required connection tests before the meeting.

Pursuant to Standing Order 108(2), the committee is commencing a study of the federal government's electric vehicle policies. As colleagues know, this is a motion we passed a couple of weeks ago following a set of announcements that came from the government.

We have a few witnesses here with us today in the room. From the Canadian Automobile Dealers Association, we have Tim Reuss, president and chief executive officer, and Charles Bernard, chief economist. From Clean Energy Canada, we have Rachel Doran. From Electric Mobility Canada, we have Daniel Breton, president and chief executive officer.

For witnesses who are representing one organization, you will have up to of five minutes for your introductory remarks, following which there will be a line of questioning from the members of various political parties seated before you today.

I look forward to having a productive conversation.

With that, Mr. Reuss, I will pass the floor to you for up to five minutes.

[Tim Reuss, President and Chief Executive Officer, Canadian Automobile Dealers Association]

Thank you very much, Mr. Chair.

Good morning, and thank you for inviting us today.

The Canadian Automobile Dealers Association represents 3,400 franchise new car and truck dealers across Canada and directly employs over 178,000 people. It contributes $28 billion to Canada's GDP and pays over $6 billion in federal, provincial and municipal taxes. This year, our members will sell over 1.9 million new vehicles, sell over 1.3 million used vehicles and write 31 million repair orders.

I would like to start by applauding the federal government on the recently announced auto strategy. The expanded and adjusted support measures aimed at maintaining Canada's vital automotive manufacturing sector are essential as we enter the critical phase of the CUSMA review.

Dealers across Canada particularly applaud the government for ending the EV mandate and choosing a better path forward for emissions reductions that is more in line with diverse technology, charging infrastructure and overall consumer demand. While the federal movement away from an EV mandate is a positive step, two things are important.

First is that the EVAS regulation be immediately withdrawn. Allowing it to remain in place while a detailed regulatory framework is worked out on greenhouse gas emissions maintains uncertainty in the industry and leaves automotive companies in the position of managing regulatory decisions and potential penalties via press release.

Second, the remaining provincial electric vehicle mandates in British Columbia and Quebec must also be removed. While we recognize that these are provincial decisions, they are clearly interprovincial trade barriers that make Canada grossly inefficient. Ottawa must call on the provinces, and the provinces must recognize that this internal trade barrier can be damaging, not just to consumers and dealers but to manufacturers' ability to operate in Canada. Removing the EV mandate was the first of five points in our automotive competitive framework that we released a year ago.

Since then, the government has also listened to us during the review of the Bank Act by not allowing big banks to unfairly compete with the small businesses they finance. The federal government also finally paid the debt of over $11 million owed to dealers for the iZEV incentives.

The two matters still pending for us are the expansion of Canada's automotive regulatory framework and scrapping the inefficient luxury tax on vehicles.

On the first one, we encourage the government to continue along the path of diversifying Canada's economy. For our industry, we have recommended that Canada consider expanding its automotive regulatory framework, particularly concerning safety and emissions standards, to accept vehicles that have been deemed safe and environmentally compliant in other jurisdictions with which Canada has free trade agreements, specifically, the European Union, South Korea and Japan. These vehicles are not often introduced in Canada because of the substantial investment required to adapt their engineering and design to comply with the current Canadian and American regulatory frameworks for safety and emissions.

CADA urges the Canadian government to consider alternative methods for effectively regulating new vehicles sold in Canada. The primary goal to ensure vehicle safety and environmental protection remains while simultaneously offering a broader selection of vehicles that are potentially more fuel efficient and more affordable for consumers.

As for the second one, the luxury tax, that has been an unmitigated disaster and a clear example of an inefficient tax. Even the Parliamentary Budget Officer correctly predicted that it would never have its intended effect, as consumers would adjust their behaviour and buy around this tax. By administering the tax outside of tested systems such as HST/GST, costs have increased for the government, dealers and consumers. The process is so fraught with problems and inconsistencies that the CRA has had to issue countless clarifications. It is time for this inefficient tax to be eliminated.

Thank you for your time.

I would now like to turn it over to our chief economist.

[Charles Bernard, Chief Economist, Canadian Automobile Dealers Association]

Very quickly, I would just like to say in French that my name is Charles Bernard and that I am the chief economist for the Canadian Automobile Dealers Association. The corporation represents 3,400 dealerships, accounting for 178,000 jobs in Canada, and contributes about $29 billion to the economy.

I would also like to say, once again in French, that we welcome the pragmatic approach rooted in market reality that the federal government has adopted. There are nonetheless still parts of the strategy that need to be adjusted, the first being to ensure that this mandate is removed, for all the reasons mentioned in previous consultations. It is not just a question of removing it while we wait for further consultations on the regulations to be completed. That creates uncertainty for the sector.

Lastly, as Mr. Reuss said, we must prevent provincial strongholds that add trade barriers which, for manufacturers and dealers and particularly for consumers, have a major financial impact in terms of cost and availability for the purchase of vehicles.

We will be pleased to answer your questions.

[The Chair, Liberal, Ben Carr]

Thank you very much, Mr. Bernard and Mr. Reuss.

Ms. Doran, the floor is yours.

[Rachel Doran, Executive Director, Clean Energy Canada]

Thank you, Mr. Chair.

Clean Energy Canada is a think tank based out of Simon Fraser University, focused on accelerating Canada's energy transition.

To set the stage, last year, more than a quarter of new cars sold globally were electric. This shift is being driven by the markets you'd expect—the European Union and China—but also by Vietnam's strong incentives and manufacturing focus and by Ethiopia, which once spent $4.5 billion a year importing fuel and is now the first country globally to ban imported industrial combustion engines.

Whatever the rationale, the shift to EVs is accelerating, and by 2035, they're on track to reach 50% of global new car sales. Bloomberg notes that electrified transport is now the largest sector of the energy transition, with close to $1 trillion U.S. spent on EV purchases and charging infrastructure in 2025.

It's a far leap to say that if Canada's auto sector is going to thrive into the future, we have to be capable of building or integrating into the supply chains for high-quality, affordable EVs, but an EV future is a bright future for Canada. We have major opportunities for producing the critical minerals, battery materials and other components that go into EVs—

[Gabriel Ste-Marie, Bloc, Joliette—Manawan, QC]

I have a point of order, Mr. Chair.

The interpreters are indicating that there is feedback and that the audio is not good enough for them to do their work.

[The Chair, Liberal, Ben Carr]

Do we know if the problem is from the witness's microphone or if it's a system problem?

We're having a brief technical issue. If you give us one moment, we're going to try to resolve it.

Thank you.

[The Chair, Liberal, Ben Carr]

I stopped the clock with about three minutes and 40 seconds remaining for your introductory remarks, Madam Doran, so we will continue from there. The floor is yours once again.

[Rachel Doran]

Effectively, despite U.S. action, we are on our way in Canada. Over half of the original investments announced in Canada's battery supply chain are still proceeding, even if on shorter timelines or with interim plans to produce batteries for stationary storage while the North American EV market matures. Canada's investments were wisely structured, so the majority of taxpayer dollars flow only when production actually happens.

Canada was still ranked second globally for EV battery supply chain potential in 2025. Its recent moves to expand its partnerships with South Korean, German and Chinese automakers can help bring technology know-how and anchor supply chains here to increase our future competitiveness.

It's true that the momentum hasn't been felt in the domestic EV market in the past year. Due to a series of policy choices, we were the only major car market to see EV sales decline in 2025, but we welcome Canada's new auto strategy, which is making the right moves to really start addressing this through support for upfront costs, a focus on affordability, investments in charging, and a strategic approach to trade and investment attraction. We hope to see a correction in 2026, because Canadians are not an exception to this global trend. Our polling shows that nearly half still lean toward an EV for their next vehicle, with support rising among younger Canadians or those who even know a single other person who owns an EV.

Canadians also recognize that EVs save money. Our 2026 total cost of ownership analysis finds that in comparable ICE-EV pairings, EVs save about $2,000 to $3,000 per year. That means up to $30,000 over a 10-year lifespan of a vehicle.

While many more North American automakers have been recalibrating strategies amidst a changing policy environment, many do focus on EVs over the longer term, which suggests they still see the future of auto as electric and are just adjusting scale and timing.

With this in mind, Canada is headed in the right direction, but we can't stop yet. There are three key remaining actions. I would say, in addition, that I support my colleague's suggestion around the adoption of safety standards from other jurisdictions as an additional means to increase the availability and supply of vehicles in Canada.

Here are my three.

Finalize strong tailpipe standards to help power the domestic market and fuel investment. Canada has now committed to 75% by 2035 and we need regulations to come into force by 2027 to really set certainty in the market. This kind of regulation doesn't mandate EV adoption, but it gives automakers flexibility in early years while requiring more EV sales as the policy ramps up. Similar regulations exist in the EU, the U.K., China, Japan and most major markets. Canada needs to have this kind of regulation to keep pace. Design really matters here because Canada's current passenger vehicle regulations have only reduced emissions by 1% since they came into force nearly 15 years ago, so getting this next iteration right is going to be critical.

We also need to recapitalize the zero-emissions vehicle infrastructure program. Recent investments in the Canada Infrastructure Bank are important, but then we need complements to help direct funding to places where the math may not pencil out yet. Rural and underserved communities and apartment residents should not be locked out of EV ownership.

Finally, Canada can strengthen the midstream of its battery supply chain. Using trade deals and policy tools, Canada could attract foreign direct investment in battery or vehicle production with provisions requiring collaboration with Canadian critical minerals producers and timelines for Canadian content. At the same time, we should protect IP in joint ventures, including through a national IP strategy, and use public procurement to grow markets and support innovation.

The EV future in Canada is bright. I look forward to responding to your questions.

[The Chair, Liberal, Ben Carr]

Great. Thank you very much.

Mr. Breton, you have the floor for five minutes.

[Daniel Breton, President and Chief Executive Officer, Electric Mobility Canada]

Thank you, Mr. Chair.

Good morning, ladies and gentlemen.

My name is Daniel Breton. I am the CEO of Electric Mobility Canada, Canada's association dedicated to the transportation electrification industry.

We represent some 200 organizations, many of them multinational, including manufacturers of cars, trucks, buses, school buses, boats, electricity providers, unions, mining companies, research centres, universities, cities, fleet managers, dealerships and charging networks.

According to an EY report published in 2025, there are now more than 130,000 people working in the Canadian EV industry, from mining to assembly, charging infrastructure to electricity production, and research and development to sales and education. By 2035 EY expects the number to increase, in a medium scenario, to approximately 600,000 jobs—well-paid, sustainable jobs—everywhere in Canada.

We support the federal government's new auto strategy, as it brings market predictability for industry and consumers alike. From support for EV manufacturing to charging infrastructure to EV affordability to GHG emissions regulation, this is a serious plan that brings to businesses a much-needed pathway towards developing a thriving EV industry in the country.

Before Christmas, I had a friendly conversation with the Right Honourable Stephen Harper. We both agreed that our neighbours to the south are doing everything in their power to try to deindustrialize Canada. We can't let that happen. Do you remember how President Trump said in January 2026 that the U.S. did not need any cars from Canada? Well, my uncle, my cousin and I used to work at a GM plant in Sainte-Thérèse that is now closed. We all know exactly what it's like. That's why we work so hard at EMC with our members to help make the transition a sustainable jobs transition for hundreds of thousands of Canadians.

Meanwhile—I sound like Stephen Colbert—the current U.S. administration is trying to go back 50 years on car regulations, on EVs, on air pollution, on safety and on science, basically. While the rest of the world is moving forward towards a future-driven automotive industry, the U.S. is indulging in nostalgia, as if we were in a Happy Days episode where the current President thinks he's the Fonz.

Canada was at a crossroads: We had to decide to follow either the U.S. in the wrong direction or the rest of the world in the right direction. The Canadian government chose the latter, and that is the right call. That's why we also agree with the government that is currently working with other countries to develop R and D, investment and manufacturing partnerships to help us move in the right direction when it comes to the future of transportation—i.e., electric transportation.

In the early eighties, I was at university. At that time, a war between Iran and Iraq erupted. It created the second oil crisis. The price of gas went up significantly, which created an economic crisis. That's when I started studying the geopolitics of energy. Forty-five years later, while consumers around the world are suffering from the current war, the price of electricity to fill up my electric car has not changed. While the price of gas is highly unpredictable, the price of electricity is highly predictable. While oil companies are mostly foreign when it comes to oil sands, electric utilities are mostly Canadian and mostly public.

In the past 10 years, electricity-related jobs have increased by 20%, meaning that there are now more jobs in the electricity sector than in oil, gas and coal combined in Canada. Most of the EV industry jobs, from mining to infrastructure to electricity production, cannot be relocated, no matter what Donald Trump says.

Four years ago, I went to Norway, and two weeks ago, I went to China. What I saw in these two very different countries is the future of transportation.

In Oslo, a small northern town, and in Shanghai, which has a population of 30 million, there is an impressive number of light-duty vehicles on the roads. The buses are all electric. The scooters are all electric. The result is astonishing. With its 30 million people, Shanghai is surprisingly quiet, and the air quality is now better than in many western cities, just 18 years after the high pollution levels seen at the Beijing Olympics.

When I was younger, I worked in a bar. At the time, we thought cigarette pollution was normal. Twenty years ago, when the government banned smoking in bars, many bar and restaurant owners screamed bloody murder, saying they would all go bankrupt. That didn't happen. It's also not going to happen with the transition to electric vehicles. One day, our children will ask us how we put up with so much pollution for so long. It is a question of future jobs in Canada and public health.

I would like to say that I agree with what Ms. Doran and Mr. Reuss said about opening the door to affordable electric vehicles from other places in the world, including Europe. I think we need to let more and more affordable electric vehicles into the Canadian market because affordability is extremely important right now.

Thank you.

[The Chair, Liberal, Ben Carr]

Thank you, Mr. Breton.

Colleagues, we will now start our first round of questioning. I'm going to pass the floor to Mr. Guglielmin for up to six minutes.

The floor is yours.

[Michael Guglielmin, Conservative, Vaughan—Woodbridge, ON]

Thank you, Chair.

Thank you to all the witnesses for being here today.

Mr. Reuss, I would like to start with you. You mentioned something that I think we concur with.

We're happy to hear that the Liberal government has finally agreed to repeal the EV mandate that so many people in the auto industry were calling for. One thing we're becoming increasingly concerned about is the fact that this EV mandate might be revisiting us through different means—a regulatory process that's so astounding they're essentially enforcing one through a back door.

What are your thoughts on this?

[Tim Reuss]

I was at a major manufacturer two days ago that has production in Canada as well. I had a conversation with their CEO. As that person put it, they're currently taking a bet on the future—on the next year. They are having to order parts and vehicles for either production or sales in Canada. They're having to bet on the future because they do not have certainty on what is exactly happening.

Yes, the Prime Minister has announced that the EVAS will be gone. However, right now, it is not gone. That leads to companies that are publicly traded having to disclose potential risks in the quarterly numbers they publish. This is the real-life aspect we currently have. If, all of a sudden, the repeal of the EVAS is now delayed until we have a good next step on a greenhouse gas emissions framework.... That's going to take some time. It's going to take somewhere from six months to a year.

The EVAS needs to be repealed now. Then, yes—absolutely—initiate discussions on what the greenhouse gas emissions framework is going to look like.

[Michael Guglielmin, Conservative, Vaughan—Woodbridge, ON]

When members of CADA appeared here last time, one of the main themes—and we heard this throughout our emergency auto study—was the need for clarity in order to breathe life into the auto sector.

You're saying that this clarity doesn't exist right now.

[Tim Reuss]

That's correct.

The manufacturers themselves don't have that clarity and are saying that they're taking bets. We should not be taking bets in the industry. We should have certainty. We should have a clear framework that everybody can work off, going forward.

That is even more so for the two provinces we mentioned, Quebec and B.C., where there's also clear uncertainty on the future of their respective mandates.

[Michael Guglielmin, Conservative, Vaughan—Woodbridge, ON]

I spent much of my career in the steel supply chain, working with supply chain integration. I'm thinking about the automotive supply chain. You have different regulatory frameworks in two different countries with such a deeply integrated supply chain.

What are the potential consequences, in your view, if there's no alignment between Canada and the U.S. on auto regulatory infrastructure?

[Tim Reuss]

We are running a huge risk long term if we do not keep some semblance of alignment with the U.S.

The reality is that we are in North America. Our supply chains are integrated in North America. If the standards drift too far apart over a number of years—we're not talking about one or two years down the road, but rather five or six—then, all of a sudden, Canada will be isolated. It will be just an island. Nobody's going to produce vehicles only for the Canadian market. That is just a reality we need to accept.

Can we then do something additionally by opening up the standards of other countries? Yes, we can, but that is on the edges. That's not going to be the core of the market. The core of our market is still alignment with the U.S.

We have to be very cognizant of the fact that, if we pick a completely different path from that of the U.S., it's not going to hurt us in the first year. Rather, five or six years down the road, it's going to be very difficult for a company to produce vehicles just for the Canadian market. The volume is not there.

[Michael Guglielmin, Conservative, Vaughan—Woodbridge, ON]

A few moments ago, you spoke about the implications of the lack of clarity when it comes to the potential for an EV mandate coming in through a back door. Now we're talking about the regulatory framework that could constrain—for lack of a better word—supply chain integrations.

If we look at risk analysis for some of these companies, is that risk now being factored in—that we might end up on an island—or are manufacturers and people in the auto industry not quite there yet?

[Tim Reuss]

That is probably a question for manufacturers to answer, in terms of what sort of risk profile they are each looking at and running.

Now, obviously, we all don't want that to happen. The intent of everybody—including the government, the opposition parties and us in the industry—is to find a solution for CUSMA now, as it's being reviewed. That is currently what we have in place. It's still everybody's preferred outcome that it gets renewed and reinforced, going forward, because it is the type of framework we need as an industry. It is stable and has provided excellent results for everybody over many decades.

[Michael Guglielmin, Conservative, Vaughan—Woodbridge, ON]

Mr. Bernard, I'm going to move to you.

CADA said publicly that members can compete as long as there's “a level playing field”. When we look at the introduction of Chinese EVs, which are often subjected to subsidies that North American manufacturers might not encompass, what would a level playing field look like?

[Charles Bernard]

I think the level playing field, in our position, is in terms of how they enter the market now that they can sell those cars. We've seen that process of having foreign entrants get into the market a bit—when I was younger—with other countries. That's a process that's normal and that was expected.

We don't know all the details of the mechanics of it, but for us, there's a perspective about business practices and also business models that work very well in Canada. That has generated immense economic output for communities across the nation. We just want to make sure that when you enter the market as a foreign entrant, you're working with the same constraints that every brand is working with.

[Tim Reuss]

To be very clear on that—

[The Chair, Liberal, Ben Carr]

It will have to be very quick, Mr. Reuss, because we're out of time.

[Tim Reuss]

Yes. On that point, to be very clear, we're advocating, for any new market entrants, for Canada and the Canadian government to administer the import quotas and provide the import quotas only to those companies that operate with a franchise dealer model in Canada.