Electric car advocates are awaiting spending details in this week’s federal budget, but for the first time, pro-EV chief executives and economists are expressing renewed optimism that Canada’s move away from internal combustion vehicles may have reached a tipping point.
After years of apologies, there are signs that a combination of forces is pushing the country into a technological and social revolution that has been likened to the horse-to-car transition that will bring affordable electric cars and trucks to streets and parking lots across Canada.
High gasoline prices, a gradual rise in carbon prices and a call from European powers for the world to use less fossil fuels in order to break Russian leader Vladimir Putin’s grip on their economies are pushing us in this direction. A number of technological developments that have resulted in electric vehicles not only being as good as internal combustion engine vehicles, but also better and cheaper to run have helped make this possible.
Now if only drivers willing to switch could find one on the property to buy.
Missing puzzle piece
According to the founder of Canadian media start-up Electric Autonomy, Nino di Cara, the only missing piece of the puzzle is that automakers and dealers simply don’t stock and sell enough electric vehicles.
“There’s already tremendous interest and demand from consumers,” di Cara said in a phone interview last week.
With gas prices soaring, there have been many reports of rising orders for electrical appliances that the industry has been unable to satisfy. But di Cara notes that it’s not a new problem.
Economics Minister: “You help Germany, you help Ukraine if you reduce your gas or energy consumption in general.”pic.twitter.com/3qw1yw8In3
When I reached out well before the recent supply chain headache, the salesman at a local car dealership, despite repeated requests, mentioned that I was looking for a truly fuel-efficient car, not the hybrid or electric cars the company was selling. And when asked directly, he was discouraging, saying they were very expensive and hard to come by. What kind of salespeople keep you from buying something expensive?
Remove electric cars from the parking lot
The new federal plan seeks to resolve that reluctance by insisting that in order to sell internal combustion engines, sellers must also pull a certain percentage of zero-emission vehicles (ZEVs) from the lot.
The program has been proven to work not only in California, a leader in the so-called ZEV mandate, but also in British Columbia and Quebec, where sales are more than three times those of Ontario and more than 10 times EV sales in Saskatchewan. (BC and Quebec also offer higher discounts.)
In a lengthy CBC interview last week, industry representative Brian Kingston, president of the Canadian Vehicle Manufacturers’ Association, raised many of the industry’s usual concerns. Producing electronics is expensive. Charging networks are not ready yet. Government tax incentives are not enough.
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There is clearly a strong business case for most automakers to sell as few electric cars as possible. Although he later changed his position, the late Fiat Chrysler boss, Canadian Sergio Marchionne, once asked customers not to buy the company’s electronics, saying he was losing money on every car sold. As he complained in 2014, in order to sell the cars as required by the government, he had to lower the price well below the additional cost of EV technology.
Same playing field
As a businessman, Nino di Cara understands the challenges of an automotive industry facing radical changes that will not pay off in the short term.
“From an automaker perspective, it’s quite understandable that you’d rather not have these mandates and requirements to sell a certain number of vehicles,” said the Toronto-based entrepreneur, who came to Canada 15 years ago from the UK after a successful business career in publishing.
But he said having standardized rules for each manufacturer levels the playing field for competing Canadian retailers.
“It’s no longer a question of when, it’s just a question of how,” said di Cara.
He pointed out that when the world switched from horsepower to oil power, there was almost no oil, yet within a few years companies learned to drill miles underground and made fortunes doing it. Rather than waiting for charging station networks to be ready or holding a supply of battery minerals on hand, these industries will grow in tandem and make profits in the process.
“Sometimes when the industry pushes back on such policies, it almost sounds like they don’t understand the market,” Mark Jaccard, a professor of sustainable energy at Simon Fraser University in Vancouver, said in a phone call last week.
drag their feet
Jaccard, often credited as the architect of British Columbia’s groundbreaking carbon tax under the right-wing Liberal provincial government, is taking a pro-market stance on what he sees as the major shift away from fossil fuels. But he has criticized the auto industry for unnecessary delays in a transition they will find hugely profitable.
“Unfortunately, the auto industry keeps convincing governments that an ambitious transition to ZEVs is impossible,” Jaccard wrote last October, predicting that the budget will be pushed toward mandatory EV sales this week.
Jaccard said he believes the country has reached a tipping point where both consumers and industry are finally on track to phase out fossil fuel vehicles. And he said the evidence can be seen in BC, where EV sales have already exceeded the province’s 10 percent mandate, with the province raising mandatory ZEV sales to 26 percent by 2026 and 90 percent by 2030. well above federal targets.
The winning design for an electric vehicle charging station by Edinburgh architect James Silvester. Gas station company Parkland, a sponsor of the competition run by Electric Autonomy, committed to build this winning design at a site in British Columbia. (James Silvester/Electric Autonomy)
But he said that with Canada’s nationwide target of 20 percent by 2026, even if a fossil-fuel government is elected — for example, after the Liberal-NDP Accord ends in 2025 — it will make the process difficult to stop. He compares it to Ontario’s coal-fired shutdown. Even after the election of the Ford government, an about-face was not possible.
Jaccard also said that since the mandate is based on the number of cars sold rather than dollar value, car dealers will be motivated to lower the price of cheaper models so they can continue to sell more profitable high-end gas guzzlers.
A new study from Clean Energy Canada, which compared electric vehicles to their internal combustion engine equivalents last week, insists that buying an electric car can already save a consumer at least $15,000 over the lifetime of a car.
From concept to business reality
Electric Autonomy’s Di Cara said the transition will not only spur automakers, but will also unleash a new spate of entrepreneurial companies that will serve the industry, much like his own start-up, an electric vehicle-based online media company. One of the company’s recent projects was a challenge for architects to create the EV equivalent of gas stations.
The winning design by Scottish architect James Silvester, who illustrated this story, will actually be realized in British Columbia by the Parkland service station company, one of the competition’s sponsors.
So is this latest federal move the tipping point where Canada can turn everyone away from fossil fuel vehicles? Di Cara is reluctant to call it a safe bet.
“I will only believe in the turning point when vehicles are sold and they are in the hands of drivers,” said di Cara. “I think it’s absolutely a huge step in the right direction.”
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