Electric vehicle (EV) incentives just made a surprise comeback, and Canadian investors should pay attention. Rebates can flip a “maybe later” purchase into a signed deal, and that can pull charging, manufacturing, and fleet spending forward. That demand ripple does not just help carmakers. It can lift the wider supply chain, including Canadian manufacturers linked to electrified transit.
On Feb. 5, 2026, Ottawa announced a new Electric Vehicle Affordability Program with $2.3 billion in funding. It said Canadians can receive up to $5,000 for battery-electric or fuel cell electric vehicles and up to $2,500 for plug-in hybrids, with a $50,000 price cap for plug-in hybrids. It also said the cap will not apply to Canadian-made EVs and plug-in hybrids, and incentives will only apply to vehicles produced in countries with a free trade agreement. So, how can investors take part?
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NFI
While not a regular EV stock, NFI Group (TSX: NFI) builds buses and coaches, plus parts and support, through brands like New Flyer, Motor Coach Industries, and Alexander Dennis. It sits in a practical corner of electrification: public transit, shuttles, and fleet refresh cycles. The EV stock has been volatile, though after plunging in share price, the EV stock has surged 11% year to date and 52% in the last year.
Operationally, the past year mixed real progress with a very public headache. On the progress side, NFI improved deliveries and pricing and kept a backlog that supports production visibility. At the end of its third quarter of 2025, it reported a backlog of $13.2 billion, and it said zero-emission buses represented 35.1% of total backlog on an equivalent-unit basis.
Earnings support
Now for the numbers that matter. In the third quarter ended Sept. 28, 2025, NFI reported revenue of $879.9 million, up from $711.3 million a year earlier. It posted a net loss of $140.9 million, or $1.18 per share, largely because it recorded a $229.9 million warranty provision tied to a battery recall.
Here is the part that makes the loss feel more like a detour than a dead end. NFI also reported adjusted net earnings of $12.1 million, or $0.10 per share, and adjusted earnings before interest, taxes, depreciation, and amortization of $80.9 million, up 52.1% year over year. It reported liquidity of $386.0 million at quarter-end, which gives it more breathing room while it works through production and service issues.
Looking ahead
Management also tried to de-risk the EV side of the story. It said it had shifted its primary battery supply for new New Flyer battery-electric buses to a different supplier that has provided battery systems since 2023. It also said it expects improvement into 2026 and beyond as it executes backlog, lifts production, and leans on higher-margin units and aftermarket growth. The risk is that another disruption, tighter municipal budgets, or slower funding approvals can delay deliveries and push cash flow around, which can whipsaw the share price.
With a market capitalization of around $2 billion, it can work for growth-focused investors who can handle bumps and who want exposure to electrification beyond passenger cars. I would buy it for the potential earnings recovery, not for income today, and I would size it like a spicy side dish, not the whole meal. If the recall costs fade and margins keep improving, the EV stock has room to surprise. If not, it can punish impatience fast.
Bottom line
One more thing: this incentive headline does not guarantee a straight line up. NFI wins when fleets place orders and when it delivers on schedule. Watch the next results for margin progress and for any fresh warranty surprises. If you want a clean dividend machine, this is the wrong tool. If you want a turnaround tied to electrification demand, it can fit inside a diversified plan.
