Demand Outlook for Used Electric Vehicles in Canada: A Measured but Growing Market Overview

Current Market Conditions

Recent reporting indicates that Canada has stepped back from aggressive EV sales mandates, replacing them with broader fuel-efficiency standards. This change has reduced short-term pressure on consumers to purchase new EVs and has contributed to softer new-vehicle EV demand .

At the same time, global automakers are slowing EV investment and production plans in response to weaker-than-expected demand, signaling a cooling phase for the new EV market rather than a collapse .

However, these headwinds in the new-vehicle segment do not translate directly to the used EV market.

Why Used EV Demand Is Expected to Increase

Despite slower new EV sales, several structural factors support rising interest in used electric vehicles:

1. Growing Used EV Supply
Canada’s EV parc expanded significantly between 2020 and 2024. As early adopters trade in vehicles and leases expire, more EVs are entering the used market, increasing consumer choice and dealer inventory availability .

2. Improved Affordability
High new-vehicle prices and interest rates have pushed many buyers toward used vehicles. Used EVs offer a lower purchase price while still delivering fuel and maintenance cost savings, making them attractive to value-focused consumers .

3. Changing Buyer Profile
Many consumers who are hesitant to commit to a new EV are willing to test the technology through a used purchase. This trend positions used EVs as an entry point rather than a replacement for new EV demand.

Demand Forecast: Short- and Medium-Term

Based on current reporting and market data, the outlook for used EV demand in Canada can be summarized as follows:

Short term (next 12 months):
Demand is expected to increase modestly, with buyers remaining price-sensitive and focused on proven models. Growth will be uneven across regions and strongest where charging infrastructure is more developed.

Medium term (2–5 years):
As EVs reach typical trade-in age (4–7 years), used EV demand is expected to strengthen more noticeably, supported by wider consumer familiarity, improved charging networks, and competitive pricing versus internal combustion vehicles.

Industry analysts broadly agree that the used EV market will expand steadily rather than rapidly, reflecting a normalization phase rather than a speculative surge .

Implications for Used-Car Dealers

For Canadian used-vehicle dealers, this environment presents both opportunity and caution:

Inventory strategy: Focus on high-demand, proven EV models with realistic range and strong reliability records.

Pricing discipline: Increased supply may put downward pressure on prices, requiring careful appraisal and sourcing.

Customer education: Buyers remain concerned about battery life, charging, and winter performance — dealers who can clearly explain ownership costs and usage realities will have an advantage.

Conclusion

While enthusiasm for new EVs has cooled, the used EV segment in Canada is positioned for gradual growth, supported by affordability, expanding supply, and long-term electrification trends already in motion. For used-car dealers, success in this segment will depend less on volume expansion and more on selective inventory, accurate pricing, and informed sales practices.

References

1. Reuters Canada expected to scrap EV mandate in favor of new fuel-efficiency system (February 2026).

2. Reuters  Another climate retreat: Canada scraps EV sales mandate (February 2026).

3. Reuters  Automakers scale back EV investments as demand softens (February 2026).

4. Canadian Energy Regulator (CER)  Zero-emission vehicles account for over 10% of new vehicle registrations in Canada (Market Snapshot, 2024).

5. AutoTrader Canada  Interest in EVs is dropping, but affordability drives used EV consideration (2024–2025 market analysis).

6. Canadian Auto Dealer Magazine  Used vehicle market trends and electrified vehicle adoption (2025–2026).