This week, the Canadian Automobile Dealers Association (CADA) was on Parliament Hill to unveil what it calls an "Automotive Competitiveness Framework." It outlines the concrete measures that, according to the association, the next federal government will need to adopt to ensure that the country and its automotive industry remain competitive, while avoiding an affordability crisis for consumers.
CADE president and CEO Tim Reuss stated that CADA's framework “outlines concrete regulatory actions we urge the next Canadian Federal Government to take in order to protect consumers, small business auto dealers and the economy.” CADA represents over 3,200 dealers across the country, collectively employing 178,000 people.
An approaching affordability crisis
Reuss said that “while we applaud the current Canadian Government on its measured response to not make this situation worse, it is clear that we are fast approaching a consumer affordability crisis.”
CADA proposes five priority measures:
1. End electric vehicle (EV) mandates
While Canada has seen notable success in EV adoption thanks to an effective alignment between demand, charging infrastructure, and incentives, the momentum is now eroding. Infrastructure is no longer evolving at the same pace, and purchase subsidies, both federal and provincial, are being reduced or eliminated.
CADA is therefore calling for an end to mandates imposing EV sales quotas.
2. Broaden Canada's regulatory horizon
Canada is still too dependent on American safety and environmental standards, which limits the choice of vehicles for Canadians.
CADA suggests recognizing vehicle conformity certifications from Japan, South Korea and the European Union. This would open up the market without commercial retaliation against the United States, while expanding choices for consumers.
3. Prevent major banks from competing with their own customers
As the Bank Act is under review, some large institutions want to be able to offer leasing directly to consumers. For CADA, this would create a conflict of interest, as banks have access to the complete financial data of the dealerships they finance.
Recall that in 2008, those same banks withdrew from the automotive financing market. CADA is therefore asking that no new latitude be granted to them.
4. Abolish the luxury tax on vehicles
Imposed recently, the luxury tax on vehicles has proven costly, ineffective and unpredictable, according to CADA. Consumers have quickly adapted their behavior to avoid it. Its management by a brand-new system, separate from GST/HST, makes it a costly tax for everyone — government, manufacturers and retailers.
CADA is calling for its outright abolition.
5. Reimburse debts related to iZEV incentives
In January 2025, Transport Canada hastily announced that the EV incentive program might run out of funds. That very weekend, an American company with little presence in Canada was able to submit over $48 million in claims. On the Monday, the program was closed. Canadian dealers advanced around $10 million to their customers, without compensation to date.
CADA says the government should immediately repay this debt.
A call to action for the future of the automotive industry in Canada
CADA's Automotive Competitiveness Framework is intended as a pragmatic guide to help the next government navigate a period of major transition. According to the association, undertaking the suggested measures would ensure a balanced, accessible, and sustainable automotive policy.