Rebates apply to 2008 model-year vehicles

Gerry Malloy

SPECIAL TO THE STAR

When the new federal budget was released last month, one of its casualties was the $1000 to $2000 rebate to buyers of designated fuel-efficient vehicles.

But contrary to what some people may believe, the program will remain in place for eligible 2008 model-year vehicles purchased new, up to March 30, 2009 – and the green levy on fuel-inefficient vehicles will continue indefinitely. To qualify for the rebates, consumers must buy or lease an eligible new vehicle, within Canada. Eligibility rules remain the same as when the program was introduced.

That means that passenger cars with a combined city/highway (55 per cent/45 per cent ) fuel-consumption rating of 6.5 L/100 kilometres or less, and minivans, SUVs and other light trucks with a combined rating of 8.3 L/100 km or less, qualify for rebates of $1000, $1500, or $2000.

So-called flex-fuel vehicles, which can operate on gasoline or a blend of 85 per cent ethanol and 15 per cent gasoline (E85), with a combined rating of 13.0 L/100 km or less also qualify for a rebate (whether they are ever operated on E85 or not).

On the other end of the spectrum, passenger vehicles (except pickup trucks and vans accommodating 10 or more passengers) with fuel-consumption ratings of 13.0 L/100 km or more are subject to a "green levy" – read gas-guzzler tax – of between $1000 and $3000.

According to Dennis DesRosiers of DesRosiers Automotive Consultants Inc., the effect of the rebates has been more to tilt buyers to specific vehicles within the most fuel-efficient segments than to move buyers from less-efficient to more-efficient segments.

According to a recent study by the C.D. Howe Institute, a large part of any CO2 emission reductions from a feebate scheme results from manufacturers introducing new fuel-saving technologies or redesigning their vehicles to qualify for the incentive or avoid the tax.

The list of 2008 vehicles eligible for the rebate would seem to support that theory. It has grown to 32 specific model variants, from 23 last year. Prominent among the newcomers to the list are manual transmission versions of the Honda Civic and Fit, which just missed the cut in 2007.

Honda offered its own matching rebates on those 2007 models, rather than cutting safety features to reduce weight and thus achieve the target figures, the company said.

"We worked very hard within an incredibly short period of time ... to make the necessary changes ... to qualify for the rebate program," said Jim Miller, executive vice-president of Honda Canada Inc. And they did so without any reduction in safety features.

Unlike the green levy, which is applied immediately at time of purchase or lease, to receive a rebate you have to make application to the government after taking delivery. Application forms are available from your dealer or from Transport Canada.

Be patient if you apply. Applicants who purchased eligible vehicles as far back as last March waited more than six months to receive their rebate cheques.

More detailed information on the program is available online at ecoaction.gc.ca.

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