The federal government is investing $1.5 billion to expand Canada’s EV-charging network as part of a broader strategy to transform the country’s auto industry.

The funding will flow through the Canada Infrastructure Bank’s Charging and Hydrogen Refueling Infrastructure Initiative and is intended to make EV charging easier and more convenient for drivers across the country. The investment forms part of a new auto strategy unveiled Thursday by Prime Minister Mark Carney that aims to position Canada as a global leader in electric vehicle production while strengthening domestic demand for EVs.

The strategy also includes measures to support auto manufacturing, tighten greenhouse-gas emissions standards, and improve EV affordability for consumers. Ottawa plans to introduce stronger emissions standards to put Canada on track for 75% EV sales by 2035 and 90% by 2040, while offering new purchase and lease incentives for electric vehicles.

“Canada’s new government is fundamentally transforming our economy – from one reliant on a single trade partner, to one that is stronger, more independent, and more resilient to global shocks,” said Prime Minister Mark Carney during a news conference at the Martinrea International autoparts plant in Vaughan, Ont. “We are making strategic decisions and generational investments to build a strong Canadian auto sector, where Canadian workers build the cars of the future.”

The purchase and lease incentives will be available to individuals and businesses. Customers will get $5,000 on a purchase or lease of a battery-electric and fuel EV, and up to $2,500 for a plug-in hybrids (PHEV) with a final transaction value of up to $50,000, as long as the cars are made by countries that Canada has free-trade deals with. The $50,000 cap will not apply to Canadian-made EVs and PHEVs.

In another move, Carney scrapped an EV-sales mandate that would have gradually done away with vehicles powered by internal-combustion engines. Conventional automakers had sought the mandate’s removal. The mandate was implemented by former prime minister Justin Trudeau’s Liberal government.

The Carney government says the combined measures are designed to protect Canadian auto workers, attract investment, and ensure the sector remains competitive as the global shift toward electric vehicles accelerates.