Tesla‘s entry-level Model Y is available for purchase with the C$5,000 EV rebate in Canada as of Friday, the company’s local website shows.
The Canadian government implemented a five-year EV Affordability Program last month, according to which it will offer Canadian consumers — both individuals and businesses — incentives of over C$5,000 ($3,700) for battery electric and fuel electric vehicles.
Eligible vehicles must have a final transaction value of no more than C$50,000 ($36,500) and must be manufactured in countries with which Canada has free trade agreements, with domestically produced vehicles being exempt from the cap.
The Rear Wheel Drive (RWD) variant of the Model Y — previously named ‘Standard’ — is priced from C$49,990, just $10 below the threshold.
Tesla‘s best-selling model is currently produced in the United States, Europe and China.
While Canadian imports usually came from the US, the company began sourcing Model Ys from the company’s European factory last year to bypass tariffs.
Portfolio in Canada
In January, Tesla launched its more affordable Model Y Standard in Canada — three months after the model’s debut in the United States and Europe.
The model’s entry-level trim is priced C$15,000 lower than the Premium variant, previously known as the Long Range All-Wheel Drive, which starts at C$64,990 ($47,500).
In mid-November, Tesla also introduced the high-end Performance trim of the crossover in Canada, priced from C$74,990 (approximately $54,800).
None of these two variants are eligible for the EV rebate, as they are priced above the CA$50,000 cap.
According to Tesla‘s website, orders placed from Friday have an estimated delivery waiting time of 4–6 weeks for the RWD and Premium variants, while the Model Y Performance is expected to be delivered between “April–May.”
The Model 3, available in Long Range and Performance trims, both All-Wheel Drive, is priced from C$79,990 ($58,500).
Earlier this month, however, the option to configure a Model 3 had been removed from Tesla‘s Canadian website, hinting that the company could stop importing the model from the United States.
Additionally, it shows no Model 3s in inventory, while plenty of Model Ys are available for customers in Ontario, Toronto, or Vancouver, even considering a radius of 200 km (124 miles).
Chinese EV Quota
Tesla Canada, which usually imports its vehicles from the United States, briefly imported from China’s Giga Shanghai in mid-2023, as reported by Reuters.
These imports could resume as trade relations between Canada and the US show little sign of improvement, with the United States-Mexico-Canada Agreement (USMCA) facing challenges in the upcoming renegotiation.
After announcing in early January that it would allow up to 49,000 Chinese EVs per year to enter Canada at a reduced tariff of just 6.1%, the country began accepting import permit applications this month.
Under the new framework, the first 24,500 vehicles can enter Canada between March 1 and August 31 on a first-come, first-served basis.
Automakers already certified in North America are best positioned to benefit from the agreement, including Geely-backed Lotus, Volvo, and Polestar.
Tesla, which opened its first Canadian store in Toronto 14 years ago, could take a significant portion of it, as its Model 3 and Model Y are produced in the GigaShanghai.
China-built vehicles are, however, ineligible for the federal EV rebate, which is restricted to models produced domestically or in free-trade partner countries.
First Quota Year
According to final regulations published in the Canada Gazette, Canada will not require any Chinese-built EVs entering the country over the next 12 months to meet the C$35,000 ($25,600) affordability threshold pledged by Carney when the deal was struck.
The provision, framed by the Government as a measure to increase the availability of affordable EVs, will not take effect until the 2027 quota year.
Three major Chinese automakers — BYD, Chery, and Geely — are confirmed to be preparing for Canadian market entry by end of 2026.
Ottawa has separately pushed Industry Minister Mélanie Joly to use the deal as leverage for Chinese EV joint ventures that would supply global markets from Canadian plants.
However, while BYD is actively considering building a manufacturing plant in Canada, the company insists on owning and operating the facility outright.
