Popularity of electric vehicles increases in 2021 but still not on track to meet federal targets

Electric vehicle sales grew nearly 60% last year, but they still need to pick up the pace to meet the new federal sales mandates expected by the end of this year.

Statistics Canada released the latest quarterly data on new vehicle registrations on Thursday, showing that in the fourth quarter of 2021, plug-in cars and SUVs accounted for more than 6% of new vehicle registrations for the first time.

Over the year as a whole, 86,000 battery electric vehicles and plug-in hybrids were sold, representing 5.2% of new registrations. This compares to 54,000 in 2020, or 3.5% of total vehicle registrations.

Five years ago, electric vehicles accounted for less than one in every 100 new cars sold. In 2021, they represented one in 20.

Environment Minister Steven Guilbeault intends to require that by 2026, electric vehicles represent one in five new passenger vehicles sold. By 2030, it will have to be at least half, and by 2035, all new vehicles sold will have to run on batteries.

It is currently developing a nationwide sales quota system that will impose penalties on dealers or automakers who do not sell enough electric vehicles.

“Switching to an electric vehicle is one of the most important things Canadians can do to help fight climate change,” Guilbeault said in a statement to The Canadian Press.

Passenger cars and trucks accounted for more than half of greenhouse gas emissions from road transportation in 2020, and more than a tenth of Canada’s total emissions that year.

Quebec and British Columbia already have provincial sales mandates and have benefited from purchase price discounts for years. They also lead the pack in overall sales, with 71% of all new electric vehicles in Canada registered in these two provinces in 2021.

Over the past five years, three out of four electric vehicles were registered in Quebec or British Columbia

In Quebec, electric vehicles represented 9% of new registrations in 2021, and in British Columbia, 11.6%. Ontario, which comes second, is at 3%.

All provinces saw growth in electric vehicle registrations in 2021.

Although the growth in electric vehicle sales is occurring, it is not able to meet Guilbeault’s new targets. At the current rate of growth, electric vehicles will account for around 15-16% of new registrations by the end of 2026.

The national sales mandate should help, but Guilbeault said Thursday the government is investing heavily to help Canada’s auto industry transform to pump electric vehicles, as well as fund more charging stations and expand the federal program discount for electric vehicles.

On Friday, Transport Minister Omar Alghabra will announce how the government intends to extend this rebate scheme so that more expensive SUVs and vans entering the EV market can be eligible.

Since the rebates began being offered in May 2019, more than 141,000 vehicles have qualified for up to $5,000 off the purchase price. As of March 31, $611 million had gone to rebates.

The recent budget adds an additional $1.7 billion to maintain them for a few more years and increase the maximum purchase price.

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