Automotive News Canada - April 2024 - 4

4
* APRIL 2024
When is the right time to drop EV rebates?
Quebec announces
the end of its
program, but the
industry thinks it's
too soon, citing
affordability issues
and stiffening ZEV
sales mandates
By GREG LAYSON
DIGITAL AND MOBILE EDITOR
THE QUEBEC GOVERNMENT
plans to end purchase incentives
for zero-emission vehicles by 2027,
a move opposed by automakers
and the association representing
Canadian dealers.
The decision is part of the 20242025
provincial budget tabled
March 11.
" This decision comes at a
time when Quebecers are facing
a major affordability crisis,
making purchase rebates absolutely
necessary for the eventual
attainment of the ZEV standard
imposed by this same government, "
said
the Canadian
Automobile
Dealers
Association
(CADA).
" The government
rationale
behind this
decision also
appears to be
flawed, " said
CADA, warning
it could hurt EV
sales.
The province
began its Roulez
Vert - Ride
Green - program
in 2012. It
has long been
the most generous
provincial
Kingston:
Ending EV
rebates in
the face of
increasingly
aggressive
sales
mandates in
Quebec is
" a recipe for
failure. "
FILE PHOTO
ZEV rebate program in Canada
with consumers currently entitled
to receive up to $7,000 off new
battery-electric and hybrid vehicles.
The
rebate can be combined
with the federal government's
Incentives for Zero-Emission
Vehicle (iZEV) Program, which
" The province's ambitious EV
sales targets will not be met without
more government attention
on the affordability challenge facing
Quebecers and a lack of accessible
charging infrastructure. "
CADA is calling on the Quebec
government to reconsider its decision
and " recognize the importance
of electric-vehicle purchase
incentives as an important tool "
in achieving EV adoption and the
province's environmental goals.
The association also says incentives
address " consumers' legitimate
concerns about affordability
and accessibility. "
The Quebec budget said the Roulez Vert - Ride Green - rebate
program was needed " to begin the electrification of the vehicle
fleet ... at a time when there were few models available. " The
program, which began in 2012, will begin decreasing the amount
of rebates beginning Jan. 1, 2025. In two years, they will be gone.
PHOTO: GREG LAYSON
offers up to $5,000 per purchase.
Both programs have maximum
price thresholds for vehicles.
Beginning Jan. 1, 2025,
Quebec's rebate will drop to $4,000
from $7,000, while the plug-in
hybrid amount drops to $2,000
from $5,000. On Jan. 1, 2026, the
rebates drop to $2,000 for BEVs
and $1,000 for PHEVs.
Incentives for electric used
vehicles and electric motorcycles
are also being reduced.
Only a $600 incentive for home
charging stations avoided the axe.
The province said in its budget
that the incentive was originally
needed " to begin the electrification
of the vehicle fleet in Quebec
at a time when there were few
models available. "
QUEBEC: LESS NEED FOR REBATES
" However, consumers have
shown growing interest in these
vehicles, which are becoming
more appealing to purchase due
to market development, technology
and the progressive narrowing
of the cost gap with gas-powered
vehicles, " the budget reads.
" The electric vehicle market is
maturing, so much so that, in the
third quarter of 2023, more than
one in five new vehicles sold in
Quebec were electric. "
But Quebec's assertion about
the price gap between EVs and
internal combustion vehicles
flies in the face of data from the
federal government.
An impact assessment accompanying
the federal Electric
Vehicle Availability Standard,
announced in December 2023 -
adopted from a California Air
Resources Board report - shows
the price of ZEVs first breaking
even with ICE vehicles in 2033.
The only segment that reaches
price parity then, however, is
cars, and Canadians buy fewer
each year. Light-truck sales,
which include SUVs and CUVs,
accounted for a record-high 85.8
per cent of total sales in Canada
in 2023, according to DesRosiers
Automotive Consultants.
ICE BAN COMING IN 2035
Despite the end of the incentives,
Quebec still plans to have
two million ZEVs on its roads by
2030. It also plans to ban the sale
of gasoline-powered light-duty
vehicles in 2035.
Canadian Vehicle
Manufacturers' Association
(CVMA) CEO Brian Kingston
said that's nearly impossible
without rebates.
" Quebec's plan to eliminate EV
purchase incentives while simultaneously
increasing regulated
EV sales targets is a recipe for
failure, " he wrote in an email to
Automotive News Canada.
The CVMA represents the
interests of the Detroit Three in
Canada.
Asked by Automotive News
Canada whether the iZEV
program would continue
beyond March 31, 2025, Prime
Minister Justin Trudeau was
noncommittal.
PHOTO: GREG LAYSON
" Removing these incentives
could significantly slow down the
progress Quebecers have made
so far in adopting electric vehicles, "
CADA said. " The data also
demonstrates that the fundamental
reason behind Quebec's success
in this transition to electric
is the usage of this aggressive and
comprehensive incentive program. "
CADA
linked provincial
rebates to British Columbia
and Quebec having the highest
EV adoption rates in Canada,
although they're also the only two
provinces with ZEV sales mandates,
which have been in place
for years.
And while B.C. offers up to
$4,000 per ZEV, some other provinces
provide as much or more:
New Brunswick, Prince Edward
Island and Yukon offer $5,000.
But Quebec might not be alone
in ending rebates. The federal
iZEV program will only continue
through March 31, 2025, and B.C.'s
2022 budget earmarked $249 million
through 2025 for ZEV rebates.
TRUDEAU: AFFORDABLE EVs
During a recent stop in
Windsor, Ont., Prime Minister
Justin Trudeau would not commit
to an extension for the iZEV
program.
" We're
always going
to look at ways
of making sure
[ZEVs are]
affordable for
people, even
as we build
the industry, "
Trudeau told
reporters.
Quebec led
all provinces in
iZEV rebates in
2023 with 68,154,
according to
Clairman:
Rebates help,
but they have
to end at
some point.
FILE PHOTO
Transport Canada. That's more
than double second-place Ontario,
which has no provincial rebates,
but nearly double the population.
Ontario accounted for 33,459 iZEV
rebates and B.C., with the highest
EV adoption rate in Canada at 23
per cent of new light-vehicle sales
in 2023, according to S&P Global
Mobility, was third with 33,153.
Cara Clairman, CEO at Plug'n
Drive, a nonprofit committed
to accelerating EV adoption in
Canada, said incentives have to
end at some point.
" As time goes on [more manufacturing,
economies of scale, battery
advancements] the price of
the EV will continue to drop and
although I don't think we will hit
price parity in 2027, we will likely
hit it soon after, " Clairman wrote
in an email to Automotive News
Canada.
" Of course, rebates do help,
but over time they should not be
needed any more. "
The Quebec government said
there are 240,000 registered ZEVs
on provincial roads and that the
funds released from the Roulez
Vert program will be spent elsewhere
" to fight climate change. "
- ANC
$4K EV rebate for Manitoba, which has 'a long way to go to catch up'
Slightly less than two per cent
of all vehicles registered in
Manitoba were EVs in 2023,
far below the average
of 10.8 per cent nationally
By GREG LAYSON
DIGITAL AND MOBILE EDITOR
Chipman:
Mainstream
buyers are
looking
for an EV
costing
less than
$50,000, so
government
incentives
are a must.
FILE PHOTO
THE MANITOBA NDP GOVERNMENT HAS
delivered on a promised electric-vehicle rebate.
Finance Minister Adrien Sala's April 2 budget
fulfilled a campaign pledge to provide up to $4,000
for the purchase of new EVs and $2,500 for plug-in
hybrids. Vehicles must have a retail price of less
than $70,000 to qualify.
There's also a $2,500 rebate for used EVs and
plug-in hybrids that are less than four years old.
The program is retroactive to Aug. 1, 2023,
extends to March 31, 2026, and is limited to one
incentive per registered EV owner and vehicle.
Many Manitobans want an electrified family
vehicle, " but the sticker shock can make this an
unrealistic dream, " the budget reads.
" We were unsure that [Premier Wab Kinew]
would come through because politicians can sometimes
make promises and claims we can't always
believe, " Steve Chipman, CEO of Birchwood
Automotive Group, said.
" But, [he] has come through with his promise
and it's retroactive. That's fantastic. "
Chipman said that EV sales at his Manitoba
stores - Birchwood owns 24 dealerships in
Manitoba and Saskatchewan - slowed over the last
few months as buyers waited for the rebate.
Slightly less than two per cent of all vehicles registered
in Manitoba were EVs in 2023, according to
Manitoba Public Insurance (MPI). That's far below
the 10.8-per-cent uptake nationally.
" So, we've got a long way to go to catch up with
the rest of the country, " Chipman said.
The Canadian Vehicle Manufacturers'
Association, which represents the Detroit Three in
Canada, applauded the incentive.
" Congratulations to [the premier] and colleagues
for addressing one of the main barriers to EV adoption, "
it said in a brief statement on X, formerly
known as Twitter.
AFTER EARLY ADOPTERS COME 'PRAGMATISTS'
The rebate will be provided to Manitobans after
they register their vehicle with MPI.
The $4,000 rebate is on top of the federal rebate
worth up to $5,000 through the Incentives for ZeroEmission
Vehicles Program.
B.C., which offers $4,000, and Quebec, which
offers $7,000, are the provinces with the highest
adoption rates of EVs in Canada.
Chipman said mainstream buyers are looking for
an EV that costs less than $50,000, so government
SEE MANITOBA PAGE 17
Automotive News Canada - April 2024

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