We’re being told that we’ll be waiting at least a year for any new EV. One dealer said that’s because they all go to British Columbia and Quebec. Do those provinces really get more EVs than the rest of us? Is that because EVs are more popular there? Or are their rebates higher than other provinces? – Eli, Winnipeg
British Columbia and Quebec do receive more EVs than other provinces – in large part because they have rules penalizing automakers for selling gas-powered cars, an environmental advocate said.
“B.C. and Quebec don’t really make up the largest chunk of the population in Canada … but EV sales are higher there,” said Ekta Bibra, senior policy advisor for clean transportation with Clean Energy Canada, an energy-based think tank at Simon Fraser University in Burnaby, B.C. “I don’t think it’s a coincidence that both B.C. and Quebec have rules that make automakers sell EVs or face pretty stiff penalties. So other provinces really only have what’s left over.”
On Dec. 30, Ottawa released draft regulations for a national zero-emission vehicle (ZEV) mandate that will require 20 per cent of new cars, SUVs and pickup trucks for sale in Canada to be a battery-electric vehicle (BEV), a plug-in hybrid electric vehicle (PHEV) or a hydrogen fuel cell vehicle by 2026. That will increase to 60 per cent by 2030 and 100 per cent by 2035.
The final version of the regulations are expected later in 2023.
But for now, B.C. and Quebec are the only provinces with a ZEV mandate, although Nova Scotia and PEI will also be adopting their own, Bibra said.
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According to auto industry analyst S&P Global Mobility, British Columbia registered 17.5 per cent of all new (ZEVs) in Canada in the third quarter of 2022, followed by 12.7 per cent in Quebec and 6.5 per cent in Ontario.
When looking only at cities, Vancouver accounted for 21.7 per cent of new ZEVs registered, Montreal had 15.5 per cent and Toronto had 8.6 per cent.
“B.C. got 60 per cent of new EVs sold in the country this year, even though the province normally counts for 40 per cent of new car sales [over all] in Canada,” Bibra said. “In B.C., one in five new cars sold was an EV – that’s three times what we’re seeing in a province like Ontario. So clearly there’s an imbalance in terms of where EVs are being prioritized.”
Not just incentives
Could incentives – money given to consumers by governments to lower the price of EVs – be the reason so many EVs go to B.C. and Quebec?
Bibra doesn’t think so. While there’s a national federal incentive of up to $5,000 on new ZEVs, and seven provinces (B.C., Yukon, Quebec, New Brunswick, Nova Scotia, PEI and Newfoundland and Labrador) offer car buyers their own rebate carrots on top of that, British Columbia’s is among the lowest, at $4,000. So it appears that the regulatory stick being waved at automakers in B.C. and Quebec – sell an escalating percentage of EVs or be penalized financially – is the deciding factor, Bibra said.
The rules are complicated, but simply put, car companies earn credits by selling BEVs or partial credits by selling PHEVs. They can also purchase credits from companies – for instance, Tesla – that have generated a surplus of credits. If they don’t generate enough credits, then they have to pay a fine – which can be as much as $20,000 a vehicle – if they sell more than a certain percentage of gas-powered vehicles.
Both Quebec and B.C. will require all vehicles sold to be ZEVs by 2035.
While cash incentives are a carrot to get consumers to buy, the ZEV mandates are a stick to get automakers to sell more electric vehicles.
Because credits can be banked from year to year, companies haven’t actually had to pay penalties in most jurisdictions, Bibra said.
But Brian Kingston, chief executive of the Canadian Vehicle Manufacturers’ Association (CVMA), which represents Ford Canada, General Motors Canada and Stellantis (formerly Fiat Chrysler), said B.C. and Quebec had policies in place to promote EVs – including rebates, education programs and plans for widespread public charging networks – before they launched their ZEV mandates.
“All of those supports were already in place and that’s what drove sales,” Kingston said.
As a consequence of the mandates, some companies sell EVs only in B.C. and Quebec – or they’ll launch new models there first before eventually sending them to other provinces.
Toyota, for instance, said it is launching its all-electric bZ4X first in those two provinces because of the mandates.
Volkswagen launched its all-electric ID.4 SUV in B.C. and Quebec last year, but it is now available nationwide. The company said wait time doesn’t vary by province.
“We are prioritizing our orders as they come in [online], not by province,” VW Canada spokesman Thomas Tetzlaff said in an e-mail. “[A] customer ordering one today can likely expect to wait at least a year as we have quite a backlog of orders already.”
Hyundai said its BEVs and PHEVs are available in every province, although they send more to B.C. and Quebec to meet the mandates.
For example, from January until the end of November 2022, Hyundai sold 4,822 Kona EVs in Canada. Of those, 3,105 were sold in Quebec, 742 in B.C. and 592 in Ontario. The remaining 383 were spread between the other seven provinces.
Hyundai said wait times aren’t based on the consumer’s province, but depend on “how far in the future a given dealership has sold its incoming units.”
National mandate?
Ottawa’s upcoming national mandate should force companies to spread their supply across Canada instead of sending more to just two provinces, Bibra said.
“[To meet the sales targets], automakers will have to produce more mass-market EVs that are more affordable for Canadians and not just focus on luxury EVs, which is what we’re seeing now,” she said.
But Toyota Canada vice-president Stephen Beatty said mandates won’t necessarily reduce wait times or increase overall supply.
“Canada is one of 180 countries where Toyota does business and many others have [regulatory mandates],” Beatty said. “Canada will get its logical fair share of global EV production.”
A national mandate will just increase costs to automakers who are already spending hundreds of billions to shift to EVs over the next decade, said CVMA’s Kingston.
“The government is believing it can regulate away global supply-chain issues, which it can’t,” Kingston said. “You’re raising a regulatory burden which increases the cost of doing business in Canada.”
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