Courtesy of Tesla, Inc.
Tesla has officially been cleared by Transport Canada in its high-profile $43.2 million CAD (about $31 million USD) EV rebate investigation, with the government finding no evidence of fraud or wrongdoing.
The probe was launched earlier this year after Tesla submitted an eye-popping 8,653 claims for federal Incentives for Zero-Emission Vehicles (iZEV) rebates over a single weekend in January 2025. The filings came just hours after Transport Canada warned that the iZEV fund was almost out of money.
According to the investigation, four Tesla locations were responsible for nearly 89% of the weekend claims, including one Quebec City store that alone submitted over 4,000 applications. In total, Tesla’s weekend claims amounted to more than $43 million — over half of the program’s remaining funds.
The unusual volume led to accusations that Tesla’s submissions were impossible, sparking claims of potential fraud. However, Tesla insisted the claims were tied to a backlog of deliveries already completed and simply processed in bulk to ensure buyers received rebates before the program’s end. In a March letter, Tesla’s Canadian head of sales, Fereshteh Zeineddin, said the automaker followed the program’s rules, which permitted post-delivery submissions.
Transport Canada has now validated that explanation, confirming the claims were legitimate and within program guidelines. As a result, Tesla’s previously frozen $43.2 million in rebate payments will now be released.
Despite being cleared, Tesla will reportedly remain banned from participating in any future iZEV programs, amid lingering U.S.-Canada trade tensions and tariff-related disputes. The automaker previously threatened to sue the federal government over the frozen funds.
Meanwhile, Canada’s Environment Minister recently confirmed that federal EV rebates will return, although no further details have been provided yet.
Tesla has had a pretty rough 2025 for Canadian sales so far, due in large part to the steep price hikes brought on by Ottawa’s tariffs on U.S.-made EVs. In an attempt to bounce back, Tesla on Thursday slashed the Model Y Long Range AWD’s price in Canada by a whopping $20,000 CAD — $5,000 less than even pre-tariff levels.
