07:11 AM EDT, 06/18/2025 (MT Newswires) -- The pause of federal -- and some provincial -- rebates in mid-January has shifted zero-emission vehicle sales (ZEV) in Canada into reverse, said Bank of Montreal (BMO).

ZEV sales as a share of total registrations fell to 8.7% in Q1

compared with 13.9% in Q4 2024, noted the bank. That sharp turnaround is perhaps best captured by the huge shifts in Quebec, where the share of ZEV sales went from 40.0% in Q4 2024 down to 13.2% in Q1.

Monthly sales in April showed some recovery after Quebec reinstated its rebate program, but it is shaping up to be a year of sideway sales -- at best -- for the ZEV market in Canada, stated BMO.

Meantime, hybrid electric vehicle (HEV) sales have continued to perform well, reaching 12.6% of vehicle sales in Q1 from 10.6% in Q4 2024.

It turns out that raising the effective price of something lowers demand for it, added the bank. Auto tariffs threaten to further disrupt the ZEV market this year, but it's likely that HEV sales will continue to strengthen.