Toronto fires shot at Elon Musk by scrapping Tesla subsidies

Toronto Mayor Olivia Chow took aim at Elon Musk's Tesla, possibly in response to Canada-U.S. tariffs, with plans to remove the electric vehicles (EVs) from the city's Zero Emissions Grant program.

In a budget meeting on Tuesday, Chow said that she'll move a motion to ban Tesla from the list of vehicles eligible for the licensing fee grant, which encourages ride-sharing drivers to buy electric vehicles. It would come into effect on March 1st. This means taxi drivers who own Tesla vehicles aiming to get or renew a license won't receive a grant.

In 2023, Toronto voted yes to the decarbonizing vehicles-for-hire plan and created a Zero Emissions Grant program, which aims to phase out gasoline taxis and ride-sharing vehicles in the next seven years and incentivize drivers to purchase electric.

Chow said that "Tesla is a very popular brand" and that there's "no reason" the city should provide subsidies. Chow also said these drivers should continue buying electric cars, not Tesla. This move would not affect taxi drivers who already own Teslas and operate these vehicles under the program.

U.S. President Donald Trump has been threatening Canada with a whole bunch of tariffs, and various levels of government have considered targeting Musk in response. 

Ontario Premier Doug Ford threatened to cancel a contract with Starlink, a satellite internet service operated by Musk's SpaceX. Chrystia Freeland, who is running to be the next leader of the federal Liberal party, also called for tariffs on Tesla.

On February 3, Trudeau spoke with Trump about pausing the Canada and U.S. tariffs for 30 days. However, this is only a pause, and if no further negotiations are held, Tariffs can start as soon as March.

The report mentions that Chow didn't directly say if she is taking the move against Tesla because of Musk, who's leading the unofficial Department of Government Efficiency and is a close friend of Trump. However, she did say that the city has other plans on how it'll respond to U.S. tariffs if needed as part of its Toronto Action Plan.

It's worth noting that Tesla raised the prices of its vehicles in Canada twice this year. The first increase made vehicles ineligible for the federal government's EV rebate, and the second seemingly was a pre-emptive move ahead of the tariffs.