Canada Splits From U.S. Emissions Rules, Adding New Worry for Automakers

For decades, American and Canadian vehicle regulations have moved in lockstep, but that era is ending. Canadian officials have quietly stepped away from recent U.S. emissions policy changes, creating another potential headache for cross-border auto trade between the two longtime allies.

While both countries have historically shared an aligned approach to regulating greenhouse gas emissions from on-road vehicles, Canada now says it plans to maintain and even strengthen its light-duty vehicle GHG rules. According to Automotive News, Canada will keep the 2026 CO2 target of 161 grams per mile across an automaker's fleet, dropping to 74 grams per mile by 2035, with continued consultations with automakers.

, Canada is backing away from its earlier zero-emissions vehicle mandate.

This contrasts sharply with the Trump administration's actions. Earlier this year, the EPA rescinded a 2009 finding on the dangers of greenhouse gases and rolled back emissions rules for passenger vehicles. The EPA stated automakers no longer have future obligations for measuring, controlling, or reporting GHG emissions for highway engines and vehicles.

Twenty-five state attorneys have challenged the changes, but success looks unlikely.

Canada isn't waiting for that outcome. It has already moved to allow limited numbers of Chinese-built electric vehicles into its market. S. automakers' grip on Canada's car market and encourage European and Asian manufacturers to bring more efficient models north. S. to persist.

The result may be a Canadian auto market that starts to resemble Mexico's more than America's.