Toronto, Ontario – The elimination of the ecoAUTO Rebate Program without the removal of the vehicle penalty fees will have an adverse effect on the domestic auto industry, according to Canadian Auto Workers Union (CAW) president Buzz Hargrove.

The federal Conservatives eliminated the rebate program, popularly known as the “feebate”, which offered cash rebates of $1,000 to $2,000 on the purchase of new vehicles that met specific fuel-economy standards. However, the budget did not eliminate the corresponding excise tax on fuel-inefficient vehicles, which ranges from $1,000 to $4,000, which the union said was initially intended to fund the rebate portion of the ecoAUTO program and has been collected since the program started in 2007.

“I am alarmed that you have chosen to keep the excise tax on larger vehicles without any indication that these fees will benefit the domestic auto industry or the environment,” Hargrove said in a letter to Federal Finance Minister Jim Flaherty. “To eliminate the rebate component of the ecoAUTO Rebate Program without removing the penalty fee imposed on larger vehicles amounts to little more than a cash grab from Canadian consumers that will have an adverse effect on our domestic auto industry.”

Connect with