Canadian Prime Minister Carney has also announced $5 billion in Canadian dollars (US$3.6 billion) to help businesses in all sectors hurt tariffs.
Released on September 5th, 2025
Canada is waived the requirement that 20% of all vehicles on sale next year do not include emissions. This is part of an aid package designed to help businesses deal with tariff damages from President Donald Trump.
Prime Minister Mark Kearney made the announcement Friday.
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The 20% target was mandated in 2023 by the then Prime Minister Justin Trudeau’s liberal government.
Trudeau’s successor, Carney, said abandoning the rules would help the industry deal with punitive US measures targeting the steel and aluminum sectors.
“This will provide immediate financial relief to automakers at a time of growing pressure on economic competitiveness,” Carney told a television news conference.
Ottawa will also launch an instant 60-day review to reduce costs associated with EV sales requirements.
The Canadian Automakers Association welcomed the move by stating its push for obligations that impose unsustainable costs on businesses and threaten investment.
Carney said it’s too early to draw conclusions on whether Ottawa should lift the 100% tariffs it imposed on Chinese-made electric vehicles last year. China on Friday extended its investigation into canola imports from Canada, one of the world’s leading suppliers.
Carney, who won the April election on the need to diversify the economy from the US, said Ottawa will establish a new fund worth $5 billion Canadian dollars ($3.6 billion) and on flexible terms that will support businesses in all sectors affected by tariffs.
The US measures “causing extreme uncertainty that is curbing large amounts of investment,” he said.
Ottawa has introduced a new policy to ensure the federal government purchases from Canadian suppliers, and has introduced a new biofuel production incentive with more than $370 million ($267 million) of Canadian dollars ($267 million) to address the challenges of immediate competitiveness.
Kearney did not mention any specific new aid to the steel and aluminum sectors. When reported, he said companies could apply for help from existing funds.
