Tesla Under Investigation for Last-Minute Rebate Claims in Canada

A recent surge of rebate requests submitted by Tesla has drawn the attention of the Minister of Transport Canada, leading to an investigation into the company's practices. As the iZEV government incentive program approached its end last month, Tesla filed an astonishing 8,600 sales requests within just three days. Tesla, despite some backlash against its CEO, Elon Musk, and connections to the U.S. Trump Administration, stated that it sold more cars in Canada during these final days than in the entire first quarter of 2024.

According to reports from the Toronto Star, Tesla claims to have delivered approximately 8,653 units over the final weekend, with over 4,000 units sold from just one location in Quebec City. This sharp uptick in sales translated to over $43 million in Canadian rebates for the company, which accounts for more than half of the remaining funds allocated for the incentive program. Although the program was initially set to continue through mid-March, the government had warned by the end of January that available funds were running low. The sudden influx of rebate requests from Tesla effectively drained the program's budget.

The Canadian Auto Dealers Association (CADA) responded to this situation by highlighting that the last-minute surge of Tesla applications left around 2,300 cars without reimbursed rebates. Dealers had issued customers the $5,000 rebate at the point of sale in good faith, expecting to be reimbursed by the program. However, with the funds depleted, these dealerships are facing an estimated collective loss of about $10 million in unfulfilled promises to their customers. CADA spokesperson Huw Williams voiced concerns, stating, "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. Tesla gamed the system."

Implications of Tesla's Sales Surge

Tesla has consistently held the title of the most popular electric vehicle (EV) in Canada, and it's reasonable to assume that the nearing end of the iZEV incentive program would lead to increased EV sales as people rushed to purchase vehicles to benefit from the rebates. While it is not surprising that Tesla would benefit the most from the program, the scale of their sales increase, particularly after experiencing a significant drop of around 70% in sales from December to January, raises questions about the legitimacy of these reported figures. Currently, uncertainty surrounds whether Tesla's claims can be fully trusted, and the ongoing investigation by Transport Canada aims to clarify the situation.

Transport Canada has indicated that while the iZEV program is currently paused, it is not permanently canceled. The future of the program remains uncertain, though the next Prime Minister, Mark Carney, has suggested the possibility of renewing the incentive program with additional government funds.

Tesla, Incentives, Investigation