FEDERAL GOVERNMENT BUDGET 2024–2025
Montreal, April 16, 2024 — Propulsion Québec, the cluster for electric and intelligent transportation, notes that the budget presented today by Canada’s Minister of Finance, Ms. Chrystia Freeland, does not include any new measures to decarbonize the heavy-duty transportation sector, nor to support the deployment of charging infrastructure. However, we welcome the efforts to encourage innovation and productivity as well as to better support small start‑up companies.
"We regret that the renewal of incentive programs for the transition to electrification of heavy vehicles is not included in the current budget. We would have liked to see more assertive support measures to decarbonize this sector and to deploy infrastructure suited to this vehicle segment. This would have provided better predictability for businesses and helped meet the environmental targets set by the government", says Ms. LLambías Meunier, CEO of Propulsion Québec.
Propulsion Québec reiterates the importance of maintaining and extending the following programs:
- Incentive program for zero-emission medium- and heavy-duty vehicles (iVMLZE)
- Infrastructure program for zero-emission vehicles (PIVEZ)
- Energy‑efficient freight transport program.
We also recommend creating a specific program adapted to school bus operators to support the electrification of their fleets.
Improved access to capital
Over the past months, Propulsion Québec has repeatedly stressed the importance of strengthening government support for companies in the electric and intelligent transportation (EIT) sector. That is why we applaud improved access to capital and the Government of Canada’s willingness to use its procurement to stimulate innovation.
"Some measures announced today will better support companies at different stages of their growth. The Scientific Research and Experimental Development (SR&ED) program will be improved, the retention of intellectual property in the clean technology field will be better protected, and access to venture capital for start‑ups will be facilitated", adds Ms. LLambías Meunier.
New investment tax credit for the electric vehicle supply chain
Propulsion Québec welcomes that the 2024 budget provides a new 10% investment tax credit for the electric vehicle supply chain, which will apply to assembly, battery production and the production of cathode active materials. The cluster recommends that the Government of Canada implement this tax credit quickly to ensure the competitiveness of companies in this sector. The same applies to other tax credits already announced by the federal government, such as the investment tax credit for clean technology manufacturing.
The cluster is also pleased to note the $607.9 million investment over two years for the Incentives Program for the Purchase of Zero‑Emission Light Duty Vehicles to ensure the affordability of electric vehicles.
A few other positive measures
Among the announcements related to transportation, it is relevant to highlight the investments over five years that could have a positive impact on the ecosystem:
- 600 million dollars over four years, beginning in 2025–2026, and 150 million dollars per year thereafter to improve the SR&ED program
- 14.5 million dollars over two years to accelerate the creation and retention of intellectual property in the clean technology sector
- 2.4 billion dollars in targeted AI support
- One‑year extension of the mineral exploration tax credit
- 200 million dollars over two years to increase entrepreneurs’ access to venture capital
- 60 million dollars over five years, beginning in 2024–2025, to Futurpreneur Canada
- Development of a pilot initiative aimed at creating an exceptional pool of talent in four key sectors: biomanufacturing, clean technologies, electric vehicle manufacturing and microelectronics, including semiconductors.
- 371.8 million dollars over six years to advance high‑frequency rail
About Propulsion Québec
Quebec’s electric and intelligent transportation cluster brings together all stakeholders in the sector around coordinated projects aimed at positioning Quebec among the leaders in the development and deployment of land‑based modes of transport that promote electric and intelligent transportation. Created in 2017, Propulsion Québec now has more than 260 members from various sectors and deploys its resources across seven distinct workstreams aimed at developing and supporting innovative projects. The cluster receives financial support from the Government of Quebec, the Government of Canada, the Communauté métropolitaine de Montréal (CMM), Mouvement Desjardins, Fasken and Hydro‑Québec.
