Tesla Inc. is set to increase prices for its vehicles in Canada, with the changes taking effect on February 1. The Model 3, Tesla's most affordable offering, will see a price hike of up to $9,000. Other models, including the Model Y, X, and S, will experience a $4,000 increase. This adjustment marks the second price rise in a short span, following a $1,000 increment earlier in January.
The recent price adjustments have significant implications for Tesla's eligibility for federal electric vehicle incentives in Canada. The initial price increase rendered both the Model 3 and Model Y ineligible for these incentives. Furthermore, Transport Canada has fully exhausted its allocated funding for the incentive program, resulting in an indefinite pause in new rebate approvals. The situation is compounded by the fact that Tesla vehicles imported from China and other countries without a free trade agreement with Canada lost their eligibility for incentives as of last October.
The timing of Tesla's price hikes aligns with potential tariff impositions by U.S. President Donald Trump on Canada, although Tesla has not specified the reasons behind the price changes. These developments pose challenges for Canadian consumers looking to purchase Tesla vehicles at reduced costs through government rebates.
The Model 3 represents the entry point into Tesla's lineup, and the increase in its price may deter potential buyers. Additionally, the halting of new rebate approvals means that consumers will face higher costs without federal financial assistance. The indefinite nature of this halt leaves many prospective buyers in uncertainty.
