By the year 2035, automakers will be legally required to sell only zero-emission vehicles in Canada, with interim regulated sales targets of 20 per cent by 2026 and 60 per cent by 2030. A first draft of the legislation was published in December, while the details and stringency of the policy remain up for debate.
If that sounds ambitious, consider the fact that many jurisdictions — including the EU, the U.K., 17 U.S. states, B.C. and Quebec — have already committed to even stronger regulations. Today, EV availability in B.C. and Quebec is four times higher than it is in Ontario, a province without requirements.
And yet, even with Canada’s comparatively soft version of the policy, many automakers have been quick to descend on Ottawa, pressuring the government to further defang its zero-emission vehicle regulation.
Of course, the federal government should make its policies and decisions based on evidence, not misinformation from lobbyists representing their bottom lines.
In 2019, Canada had the worst record in the world for average fuel economy and carbon emissions per kilometre driven.
This isn’t because Canadians don’t want to drive electric vehicles. Six in 10 Canadians already believe, correctly, that an EV would ultimately save them money.
The real problem is accessibility. Studies show that across Canada, fewer than one in five dealerships had a single EV in stock in 2022, with almost 40 per cent of dealers having wait times of more than six months.
Canada has a supply problem, not a demand problem, and the best way to address it is by requiring automakers to keep up. B.C. did just that in 2019. As of 2022, almost one in five new vehicles purchased in the province was electric.
In the past, allowing the industry to follow its own timelines simply hasn’t worked to make more EVs available for Canadians, nor to get us on track with our emissions objectives. In 2005, the federal government signed a voluntary agreement with the auto industry in which they vowed to decrease their annual emissions by 5.3 megatonnes by 2010. Because this was voluntary and there was no penalty for falling short, they missed the mark — by 95 per cent.
Carbon pollution aside, one of the best reasons for Canada to implement strong zero-emission vehicle requirements is that they make EVs more affordable for Canadians.
A recent study found that a regulated sales target would lead to a 20 per cent reduction in EV prices, as automakers would need to deliver more affordable models to Canadians, not just luxury options, in order to hit their targets.
EVs are also long-term money savers. According to a Clean Energy Canada study released last year, a typical EV will save its driver between $10,000 to $20,000 over eight years, and that’s factoring in the higher purchase price.
Helping matters further, a recent price war triggered by Tesla has driven EV prices down by more than seven per cent over the past year. For example, Ford dropped the price of the premium trim of its popular Mustang Mach-E from $75,745 to $67,245.
In the United States — thanks to increased competition, new government incentives and falling battery material prices — EVs could match gasoline cars on sticker price this year. If that sounds hard to believe, keep in mind that in the past five years, prices for some of the most popular gas vehicles, from the Ford F-150 to the Honda Civic, have increased by roughly 30 per cent to well over 50 per cent in some cases.
The question for us is, will Canadians be able to find an electric alternative?
Regulated sales targets will make EVs more available and even more affordable for Canadians in every province. Many automakers, like Ford and Tesla, saw where the puck was going and are now reaping the benefits of early action, capturing market share and shifting to mass production with better economies of scale.
Canada should not weaken its zero-emission vehicle sales targets for those automakers that miscalculated the future. Weaker policy might help their quarterly earnings, but it certainly won’t help Canadians drive cleaner, more affordable vehicles.
This post was co-authored by Electric Mobility Canada’s David Breton and originally appeared in Canada’s National Observer.