Ontario Premier Doug Ford's decision to cancel rebates for electric vehicles in the province is expected to have a knock-on effect on sales.
David Adams, president of the Global Automakers of Canada industry association, said Friday that experience elsewhere shows that sales of electric vehicles take a hit when subsidies are removed, such as when British Columbia stopped and then restarted its program.
"When they cancelled it, sales went down dramatically, and then when they reinstated it sales went back up again. That is the same pattern that we've seen in other jurisdictions internationally," he said.
Customers generally look for some kind of assistance in overcoming the extra cost of electric vehicles, Adams said.
"The reality is that without some kind of incentive in place to bridge that price differential between a regular, internal combustion engine vehicle and the more expensive electric or hydrogen vehicles, consumers just don't purchase them in the same numbers."
The Ontario program offered up to $14,000 back for buyers, but the new Ford government cancelled the rebate this week — along with the cap-and-trade program that helped fund it — as part of an effort to lower gasoline prices.
The incentives will be honoured for vehicles on order through a dealership, but they have to have been delivered and registered by Sept. 10. Adams said that could be a tight timeline for some orders so his organization will be pushing to extend it.
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Customers who ordered the Tesla Model 3 electric vehicle say the've lost out on the grace period, even if they're made non-refundable deposits, because the company sells vehicles directly to customers rather than through a dealership.
Keeping the rebates in place for a few more years would have been helpful, but it won't stop the transition to EVs, said FleetCarma CEO Matt Stevens.
"While this will certainly have a slowing effect, the long-term future of electric vehicles being where Ontario's going to go, it continues," said Stevens, whose group advocates for the adoption of electric vehicles.
He said the price gap between electric vehicles and combustion engine-based ones is coming down, but the rebates were helpful in accelerating sales growth.
"The gap is much smaller than it used to be, but there is still a gap, and that's why the incentives still had a role to play."
According to data compiled by FleetCarma, 7,477 battery and plug-in hybrid electric vehicles were sold in Ontario last year, up 120 per cent from 2016 when increased rebates were implemented.
The Ontario government has also cancelled an incentive program for electric vehicle charging stations that offered up to $1,000 to offset the cost of a home or office station.
B.C. and Quebec, where sales were estimated at 3,270 and 7,194 respectively in 2017, still have incentives in place. Quebec also has in place a mandate for 10 per cent of new vehicles sales to be zero emissions by 2025.
Ontario's program had come under criticism for subsidizing expensive cars, but the environmental benefits of increased electric vehicle use are widespread, said Stevens.
"There is a general view that there is broad social good in helping us transition to electric vehicles faster."
Most G7 nations have some level of federal electric vehicle incentive, making Canada something of an outlier on the national level, he said.
Overall vehicle sales in Canada grew 4.8 per cent to a record 2.08 million last year. By December, electric vehicles accounted for 1.4 per cent of all sales.
There were nearly 48,000 electric vehicles on Canada’s roads last year, up from 29,000 in 2016.
In 2016, the Oil and Gas
In 2016, the Oil and Gas sector and Transportation sectors were the largest greenhouse gas (GHG) emitters in Canada. Together, they accounted for almost 50% of Canada's total emissions. The growing trend of consumer preference for SUV's, vans and light trucks has resulted emissions more than doubling, from 20.7 Mt (CO2 e) in 1990 to 49.3 Mt in 2016, which has more than offset reductions in passenger car emissions from 41.6 Mt in 1990 to 35.8 Mt in 2016. The Canadian mix of new cars in 2007 was 49% light trucks, 51% passenger cars. In 2017, 69% of new vehicles sold in Canada were light trucks, 31% were passenger cars.
(source: Environment and Climate Change Canada 2018 "National Inventory Report 1990-2016: Greenhouse Gas Sources and Sinks in Canada")
In Ontario, the transportation sector is already the largest contributor of GHG emissions (33%), followed by industry (29%), buildings (22%), agriculture (7%), waste (5%), and electricity (3%). Between 1990 and 2015, emissions from the transportation sector went up 34%, from 41 Mt in 1990 to 55 Mt in 2015. Freight transportation is the fastest growing source of Ontario GHG emissions. Freight emissions have more than double since 1990, going from 8.6Mt to 18.7 Mt in 2015. The growing emissions in the passenger car sector (35.3 Mt in 2015) also reflects consumer preference for bigger gas-guzzling vehicles.
(source: "Ontario's Climate Act From Plan to Progress", Environmental Commissioner of Ontario, January 2018)
Doug Ford policies in the transportation sector will contribute to higher emissions, more pollution and more health problem. His new "very well rewarded" health adviser should realize that his good friend policies, like lowering the price of gasoline at the pump, will only enhance drivers to burn more fuel, which will result in higher pollution levels, and eventually bring more sick people to the already crowded hospital hallways.
It is so regressive to
It is so regressive to eliminate the rebates for EVs, which, of course, many of us expected from our new Premier. We have had a Kia for three years+ and we love it! I suggest that people who were considering an EV and are reluctant because of this rebate cancellation, do some calculations on how much you actually spend on fuel and service maintenance over the life of your current gas-powered vehicle. Our experience with our home charger is that we barely notice any change in electricity use over this time. So the money you will save each week over the life of an EV by not filling your tank every week or ten days at 50 bucks plus is considerable. With those calculations, some consumers might just get one anyway. I encourage you to at least do the math. And you would also be preventing a bit more of the damage to the environment . Worth thinking about it?
Your comment is appreciated.
Your comment is appreciated. Thanks.
My concern has always been where the electricity comes from for e-vehicles. I can't see how it could be environmentally friendly until there is more, or enough, renewable electricity.
(Can't edit my comment so
(Can't edit my comment so here's another.)
I think every bit helps but I can't help feeling discouraged as long as there is no majority of Ontarians that will accept wholesale changes from private vehicles to better mass transit, or something. I think the majority of the solution has to come from policy directives and not just letting people contribute a little on their own (although I try).
So much for private family
So much for private family-friendly business practices. They would cry like babies if they lost and election to a government that punished their voters. And some of these will be THEIR voters!