Automakers in Canada are doubtful that Canadian consumers are on track to meet the Trudeau government’s electric vehicle targets by 2035.
Executives from Toyota Motor Corp. and Honda Motor Co. said that they only expect consumers will take the leap from gas-powered vehicles once it proves more affordable to do so, and only after a charging infrastructure is in place to meet the needs of commuters sufficiently.
“We need to make sure that we’re revisiting targets to align targets with reality,” Frank Voss, president of Toyota Motor Manufacturing Canada, told Bloomberg in an interview.
“The government can only do so much to entice consumers to purchase vehicles that they would like to see implemented. Consumers will choose what they need.”
EVs only accounted for 11% of registered vehicles in Canada last year and while some project that they may account for 70% by 2035, sales have dropped in recent years.
EVs were harder to sell than gas-powered vehicles in 2023 for the second year in a row, with fewer than half of Canadians now saying they plan to make their next car purchase an electric vehicle.
The average price of a new vehicle is $66,000, while the average price of a new EV is $73,000, according to Canadian Black Book.
On top of their additional expense, EVs are known to perform poorly in below-freezing temperatures, as their lithium-ion batteries lose at least 20% of their range.
Toyota executives say that range is an issue they are trying to fix, but that they also have to balance that against concerns of weight and size.
Range is a primary concern for consumers in a country as vast as Canada, with many hundreds of kilometres between major cities.
The federal government plans to install 84,500 chargers and 45 hydrogen chargers across the country by 2029 as part of its Zero Emission Vehicle Infrastructure Program.
The Department of Natural Resources projects that Canada will need around 200,000 public chargers by 2035. The department is also hopeful that the private sector will contribute charges as well
According to the department, the only region to meet 100% of its charger infrastructure target so far is Canada’s Arctic, where 34 chargers were installed across three territories to service the seven EVs located there.
The current targets have been seen as unrealistic by members of the auto industry, who have urged Ottawa to align its targets more closely to those of the U.S. government, which aims to have 50% or more EVs on the road by 2032.
Whereas, the Trudeau government has a mandate to require all new passenger vehicles and light trucks sold in Canada to be zero-emission by 2035.
Despite recommendations from industry experts, Trudeau remains vigilant in his environmental goals.
“There’s a lot of things that need to fall into place to give people the confidence to make the transition,” said Jean Marc Leclerc, chief executive officer of Honda Canada in an interview with Bloomberg.
“It may not be fully there today to support the rate of adoption that we’re asked to deliver, but we know it’s going to be there.”
One compromise is offering consumers hybrid vehicles, which have already been proven easier to sell to consumers when compared to EVs.
However, if the hybrids don’t plug in, they are recognized under the government’s zero-emission vehicle targets because they still use internal combustion engines.
According to Leclerc, Honda plans to reduce battery costs by 20% and manufacturing costs by 35% for cars manufactured in Ontario through local supply chains for raw materials, which will lower transportation costs.
Toyota on the other hand has decided to hold off from building EVs in Canada until consumer demand and infrastructure increase.
“Even with my plug-in hybrid, last week I was in Toronto, I went to two different locations, all five chargers didn’t work,” said Voss. “Infrastructure, as it becomes more capable and catches up, it’ll be a great support to that.”
