Much like the U.S., Canada has an electric vehicle (EV) rebate program designed to encourage buyers to switch to fully electric cars. The program was so popular that it was set to end early, but recent claims from car dealerships suggest Tesla may have exploited the system to take a disproportionate amount of the remaining funds, ultimately causing the program to shut down even sooner than expected.
If true, Tesla’s actions could have created an unfair advantage, allowing the company to capture over half of the remaining CAD 71 million in rebate funds, leaving many dealerships unable to secure rebates for their customers.
How Tesla Allegedly Gamified the System
As the program was nearing its end, Tesla reportedly over-reported the number of vehicles it sold. Over the course of three days, the company claimed to have sold more than 8,600 vehicles across four different dealerships in Canada. With each electric vehicle qualifying for a $5,000 rebate, this resulted in Tesla securing over CAD 43.1 million from the program.
This would mean that Tesla was selling around 120 cars per hour—roughly two Teslas every minute—across the four dealerships, even during hours when they were closed. In other words, Tesla claimed to have sold two cars per minute, 24 hours a day, for three straight days.
How the Canadian EV Rebate Program Works
In Canada, EV rebates are managed by the government and offered through car dealerships. The rebate is applied at the point of sale, with the government reimbursing dealerships afterward. Dealerships must submit rebate applications before the car is delivered.
This year, EV sales surged in Canada, prompting the program to be set to close early due to higher-than-expected rebate claims. Dealers had been selling EVs under the assumption that the program would end soon, but they did not anticipate a company like Tesla rapidly selling an overwhelming number of vehicles at the last minute.
Why Dealerships Are Frustrated
Huw Williams, a spokesperson for the Canada Automobile Dealers Association, expressed frustration with the situation: “These dealers in good faith gave customers the money for a program that is always refunded. They shouldn’t be left making a payment on behalf of the Government of Canada.”
Dealerships were operating under the belief that other dealers were selling cars fairly and normally. However, Tesla’s aggressive push for rebates in such a short window of time effectively depleted the available funds, preventing many other dealerships from securing rebates for their sales. Estimates suggest that dealerships across Canada may be out CAD 10 million or more due to this situation.
Did Tesla Cheat the System?
There are suspicions surrounding Tesla’s sudden spike in sales. According to the National Post, Tesla’s sales in Canada dropped by 70% from December 2024 to January 2025. This sharp decline, coupled with the timing of Tesla’s rebate claims—right before the program was set to expire—raises questions.
While Tesla may have experienced a legitimate surge in sales, the timing and scale of these sales seem highly suspicious, especially when contrasted with reports indicating a dip in Tesla’s sales during this period. It remains to be seen whether Tesla’s actions were legal or if the company found a way to game the system for its benefit.
