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Canada freezes CO2 standards for passenger cars until 2029

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Canada freezes CO2 standards for passenger cars until 2029

Canada's government is freezing fleet emission standards for passenger cars and light commercial vehicles at 2026 levels through 2029. This move aims to give automakers more flexibility. However, annual tightening of standards will resume starting with the 2030 model year.

The decision is part of a joint package of measures introduced by the Canadian federal government and the province of Ontario on 21 October. Under the plan, the fleet-wide greenhouse gas emission limit will remain at 172 grams per mile, equivalent to approximately 107 grams per kilometre. Annual tightening of the standards will resume only from the 2030 model year. To achieve the target of 75 per cent electric vehicle sales by 2035, the fleet average must ultimately drop to 74 grams of CO₂ per mile, or about 46 grams per kilometre.

The governments justify the pause by citing the strained situation in the industry. “Maintaining the fleet average performance standard will provide manufacturers with near-term flexibility at a time when the industry is facing trade-related pressures,” stated a joint declaration by Canada’s Prime Minister Mark Carney and Ontario’s Premier Doug Ford. Additionally, manufacturers can accumulate greenhouse gas credits for future years while gradually improving the emissions performance of their vehicles and their fuel efficiency.

The relaxation of emission standards is accompanied by additional government support for the Canadian automotive industry. 5 billion (approx. 6 billion) over two years for major investment projects. 5 billion will come from the federal government and up to CA$1 billion from Ontario. The funds are intended to help companies adapt to changing economic conditions, strengthen their competitiveness, and secure jobs along the supply chain.


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