February ZEV Sales Hit 10.2% Share as EVAP Lifts Demand
TLDR: Statistics Canada’s February 2026 motor vehicle sales data, released April 16, shows zero-emission vehicle sales jumping 47.2% year-over-year — driven by a federal rebate that was only active for 13 of the month’s 28 days.
- 12,626 ZEVs were sold in February 2026, reaching 10.2% of total new vehicle sales — up from 6.9% in February 2025; in British Columbia alone, ZEV sales surged 36%, according to Business in Vancouver
- January 2026 ZEV sales totalled approximately 8,672 units before the EVAP rebate launched on February 16, making the February rebound even more pronounced — Canadian web searches for “EV” and “plug-in hybrid” hit all-time highs in February, according to Electric Autonomy Canada
- The EVAP rebate ($5,000 for BEVs, $2,500 for PHEVs) was active for 13 days of February; with a full month of program availability from March onward, ZEV penetration is expected to continue climbing toward and above the 11.2% average recorded in Q4 2025 (S&P Global)
- Overall market conditions are moving in the opposite direction: Q1 2026 came in at 406,000 units, down 4.4% year-over-year, with March estimated at fewer than 170,000 units — an 8.2% decline and the steepest monthly drop in recent years, according to Automotive News Canada
- TD Economics forecasts 2026 total Canadian new vehicle sales at 1.9 million units, down 4.3% from the 2025 six-year high — tariff uncertainty, Bank of Canada neutrality, and slowing population growth are the stated headwinds
- Dealers carrying EVAP-eligible models face a split market: accelerating ZEV-specific demand against a softening conventional vehicle backdrop — inventory strategy and EVAP operational readiness have not been more consequential
Statistics Canada released its February 2026 new motor vehicle sales report on April 16, and the most consequential figure for Canadian dealers is not the broad market number. Zero-emission vehicle sales reached 12,626 units — a 47.2% year-over-year increase — representing 10.2% of all new vehicles sold in Canada that month. The federal Electric Vehicle Affordability Program, which provides rebates of up to $5,000 for eligible battery electric vehicles, launched on February 16. It was active for exactly 13 of February’s 28 days.
The Numbers in Full
Total new vehicle sales in February came in at 124,004 units, down 0.9% from February 2025. Passenger car volumes fell 3.8%; light trucks, which account for the majority of Canadian sales, declined 0.5%. Those figures are consistent with the broader deceleration that has characterised the market since the latter half of 2025.
The ZEV figures sit in sharp contrast. The 10.2% market share recorded in February is up from 6.9% in February 2025 — a gain of 3.3 percentage points in twelve months. For context, Canada’s zero-emission vehicle market share averaged 11.2% across Q4 2025, according to S&P Global data cited by Electric Autonomy Canada. The February figure’s dip below that level is directly explained by the calendar: January 2026 saw approximately 8,672 zero-emission vehicles sold before the EVAP rebate came into effect, reflecting a market that had spent much of the winter without federal incentive support. February’s rebound — from roughly 8,672 units to 12,626 — happened in a compressed window of roughly two weeks.
In British Columbia, ZEV sales surged 36% in February as federal rebates returned, according to Business in Vancouver — a provincial figure consistent with the national direction, though each market carries its own inventory mix and consumer profile. Quebec’s ZEV adoption rate has historically led the country due to provincial incentives layered on top of the federal programme; the February Statistics Canada report does not break out provincial data at the ZEV level, but the BC figure provides a useful directional signal.
EVAP as the Demand Catalyst
Web search data provides a parallel signal to the StatCan figures. According to Electric Autonomy Canada, Canadian searches for “EV” and “plug-in hybrid” reached all-time highs in February 2026. ZEV insurance quote searches tracked by Electric Autonomy Canada ran 33% above year-ago levels in February and 19% above in January — a pattern consistent with consumers actively planning EV purchases around the rebate’s return rather than acting spontaneously in the month it launched.
That behaviour pattern matters for interpreting the February data correctly. The 47.2% year-over-year surge did not represent merely 13 days of EVAP-driven incremental sales — it also captured consumers who had been deferring EV purchases since the predecessor iZEV programme expired and who converted once federal support was confirmed. The low January figure suggests that pent-up demand was real and that it released into February’s second half rather than distributing evenly through Q1.
The detailed mechanics of EVAP — the six-step dealer portal process, eligible model list, the $50,000 transaction value cap, and the declining annual rebate schedule through 2030 — were covered in full in the EVAP dealer guide published here on April 7. The February sales data is the first empirical confirmation that the programme is generating the consumer response it was designed to create.
On the supply side, General Motors Canada finished 2025 as the country’s top EV seller, led by the Chevrolet Equinox EV — the most consistent volume performer among EVAP-eligible models. Hyundai and Kia have built strong ZEV volumes through their IONIQ 5, IONIQ 6, Kona Electric, EV6, and related PHEV trims, which together account for a significant portion of the approximately 69 EVAP-eligible entries on Transport Canada’s live model list. In British Columbia, the Hyundai IONIQ 5 has emerged as the province’s top-selling EV model. The Volkswagen ID.4 and Ford F-150 Lightning (qualifying trims) round out the eligible models with meaningful volume in the Canadian market.
The Broader Market: Tariff Headwinds and Softening Volume
The ZEV surge is occurring against an overall market that dealers cannot afford to ignore. Q1 2026 came in at 406,000 units — down 4.4% from Q1 2025, according to Automotive News Canada. March was the weakest month of the quarter, with volumes estimated at fewer than 170,000 units, an 8.2% year-over-year decline and the steepest monthly drop in recent years. The Q1 weakness follows 2025’s six-year high of approximately 2 million units, and the contrast is significant: what felt like a durable recovery in 2025 has given way to a more cautious market in the first three months of 2026.
TD Economics projects full-year 2026 Canadian new vehicle sales at 1.9 million units — down 4.3% from 2025. The firm cites several compounding constraints. Ongoing 25% U.S. auto tariffs, combined with Canada’s retaliatory measures, have disrupted cross-border supply chains and kept vehicle prices elevated. The Bank of Canada has held rates in neutral, leaving monthly payments hovering around $1,000 — a persistent friction point for consumers evaluating affordability at the deal table. Population growth, a significant demand driver through the post-pandemic period, is decelerating as federal immigration targets are corrected downward.
Looking further ahead, the first scheduled review of the Canada-United States-Mexico Agreement (CUSMA) begins July 1, 2026, adding trade policy uncertainty to second-half planning. A renegotiation that alters Rules of Origin provisions or tariff schedules would have direct implications for Canadian vehicle pricing and dealer allocation across multiple brands.
Canadian automotive production has also contracted: manufacturing output fell 5.4% in 2025, with reductions at General Motors’ Oshawa plant — which cut a shift in January 2026 — and at Toyota’s Cambridge and Woodstock facilities. Supply constraints have kept used vehicle values elevated and contributed to the affordability pressure visible in the sales data.
Within this environment, EVAP-eligible vehicles carry a meaningful structural advantage. A $5,000 federal rebate on an eligible BEV, applied directly at the bill of sale, reduces the effective monthly payment on a 60-month finance deal by approximately $80 to $95 per month depending on the financing rate — a material reduction against a $1,000-per-month market baseline.
What This Means for Your Dealership
The February data gives dealers two actionable signals: ZEV-specific demand is real, measurable, and growing faster than the incentive programme has even had time to fully express; and overall volume conditions are tightening in ways that make differentiation on EV competency increasingly important.
Prioritise EVAP-eligible inventory through Q2. The February and March ZEV data will capture only the programme’s early weeks and first full month respectively. Consumer interest, as measured by search behaviour and insurance quote inquiries, is at historically elevated levels. Dealers carrying eligible models — the Equinox EV, IONIQ 5 and 6, EV6, ID.4, F-150 Lightning qualifying trims, and the full list of Kia and Hyundai PHEV configurations — should treat Q2 2026 as the peak demand window. The BEV rebate declines from $5,000 to $4,000 in 2027; the PHEV rebate drops from $2,500 to $2,000. Presenting this declining schedule accurately and clearly to customers is both sound sales practice and a genuine financial service.
Ensure the EVAP portal workflow is fully operational before the next ZEV delivery. The February data confirms that buyers are actively converting — including consumers who deferred purchases during the iZEV gap. A dealer whose EVAP enrollment is incomplete, whose staff is collecting the Consumer Consent Form after delivery rather than before, or whose Attestation Form data does not match the bill of sale is creating avoidable claim rejections in a programme that requires documents to match exactly. The full process is detailed in the EVAP dealer guide.
Watch the March Statistics Canada release in mid-May. The February figures reflect fewer than half a month of EVAP effect. March — the first complete month under the programme — will be the definitive early indicator of where ZEV penetration settles under steady-state rebate conditions. If March comes in at or above the Q4 2025 average of 11.2%, that reading will strengthen the case for accelerating EV inventory investment. The release is expected around May 15.
Plan overall volume targets conservatively. TD Economics’ forecast of 1.9 million units for 2026 is now supported by the Q1 actuals. Dealers who set second-half targets against 2025’s trajectory without accounting for tariff, affordability, and trade policy headwinds face meaningful downside risk. Mixed-franchise rooftops with strong ZEV lineups and operational EVAP processes are better positioned than ICE-heavy stores to hold gross through a softer-volume market.
Manage the financing conversation around the rebate. In a market where $1,000 monthly payments are the most commonly cited affordability constraint, a $5,000 reduction in the financed amount is a concrete tool — not a talking point. Finance managers presenting EV deals should lead with the net financed amount after the rebate, not the MSRP, and build amortisation comparisons against equivalent ICE vehicles. That structure serves the customer’s decision-making process and converts the EVAP rebate from background context into a deal-closing variable.