Automotive News Canada - October 2024 - 48

48
* OCTOBER 2024
EV pace of growth slows, but it's still growth
ZEV REGISTRATIONS, QUARTERLY
70,000
60,000
QUARTERLY ZEV REGISTRATION GROWTH, YEAR OVER YEAR
50,000
,000
40,000
,000
,000
I can't think of
,000
anything growing
faster than EVs in
,000
Canada. "
,000
2018
,000
Steve Flamand
Executive director
of national sales and
2019
2018
digital strategy for
Hyundai Canada
2019
2020
2020
2021
BEVs PHEVs
30,000
ZEV REGISTRATIONS, QUARTERLY
20,000
10,000
250
225
200
175
150
125
100
75
50
25
2021
BEVs PHEVs
2022
-25
-50
-75
2018
CONTINUED FROM PAGE 1
(PHEVs) within the ZEV category.
The " exponential " growth rate of past
years has slowed, said Steve Flamand, executive
director of national sales and digital
strategy for Hyundai Canada, but volumes
continue to steadily gain ground.
The registration of more than 65,000
ZEVs from April to June reflected growth
of 37.9 per cent from the same quarter a
year earlier, Statistics Canada said.
" I can't think of anything growing faster
than EVs in Canada, " Flamand said. " But
of course, it's not doubling every year like
it used to, so our brain is kind of trained to
say things are slowing down. "
Hyundai ranks second in ZEV sales in
Canada this year, trailing only Tesla.
And unlike many other automakers,
Flamand said, Hyundai has no plans to
scale back its electrification plans. The
company began EV production in October
at its new plant in Georgia, which builds
the Ioniq 5. The company is preparing
to add production capacity with more
hybrids, PHEVs and extended-range EVs,
which use an electric motor to turn a vehicle's
wheels and an internal-combustion
engine to charge the motor's battery.
" We'll round up the whole portfolio
so we can be ready as a brand for every
customer's needs at every price point, "
Flamand said.
'STILL RAPID GROWTH'
Ford Canada is taking a similar
approach, broadening the powertrain
options across its lineup to give customers
" freedom of choice, " CEO Bev Goodman
told sibling publication Automotive News
in August.
Goodman said she expects growth for
all electrified powertrains in the coming
years, including BEVs.
" Despite the fact that [BEV adoption]
is slower than what some of us had hoped
for, " she said, " it is still rapid growth. "
The recent sentiment in the market that
BEVs are losing ground, Goodman added,
runs counter to reality. Ford expects sales
to account for 10 per cent to 11 per cent of
Canada's light-duty-vehicle market this
year, she said. That's up from about eight
per cent last year, representing growth of
35 to 40 per cent and tracking with growth
in the second quarter.
But unlike Hyundai - which is " doubling
down " on BEVs, Flamand said -
Ford is among the automakers that have
tapped the brakes this year.
In April, Ford announced a two-year
delay for its large electric utility vehicles
planned for assembly in Oakville,
Ont. Then over the summer, the company
rejigged plans again, saying it would cancel
the large electric utility vehicles outright
and bring Super
Duty pickup production
to Oakville.
Ford also has pushed
back other BEV programs
to focus on
hybrids.
In August,
Goodman would
not say when Ford
would add another
vehicle to its
BEV lineup of just
two vehicles: the
Mustang Mach-E
crossover, which
debuted in late 2020,
and F-150 Lightning
pickup that reached
dealerships in 2022.
Other automakers
have made similar
adjustments to their
production plans
In spring, J.D. Power found that 28.5 per
cent of buyers are likely to consider a BEV,
down from 34 per cent in 2023. Autotrader
found that 46 per cent of Canadians are
interested in BEVs as their next vehicle,
down from 56 per cent in 2023.
Consumers in both studies cited high
upfront EV costs among the key barriers.
QUEBEC SKEWS ZEV SALES STORY
As with automakers pulling back on
ZEVs, however, the cooling consumer appetite
clashes with the reality of rising ZEV
sales.
One province is a significant part of the
explanation.
All Canadians have access to the up to
$5,000 federal rebate for ZEVs. But it's no
coincidence that buyers
in Quebec - who
get up to an additional
$7,000 off through
the provincial incentive
- are driving
most of Canada's
ZEV volume, Hearn
said.
Quebec had
The Hyundai Kona Electric has a
base price more than $20,000 greater
than the gasoline version, which has
fewer features. When stacked against
vehicles that have similar features, the
Kona Electric is increasingly attractive
from a total-cost-of-ownership
perspective, Hyundai Canada's Steve
Flamand said. PHOTO: HYUNDAI
throughout 2024 or walked back previous
commitments for when lineups would shift
to EVs.
The choppiness has extended upstream
in the supply chain with battery-cell and
materials producers such as Umicore in
Ontario pausing or delaying spending, citing
a slower-than-expected ZEV ramp-up.
'COMES DOWN TO PRICE'
The pullback appears counterintuitive,
given the increasing sales of ZEVs. But it's
the result of overly ambitious sales expectations
that haven't come to fruition, said
James Hearn, associate director and product
manager of Canada industry performance
at S&P Global Mobility.
Automakers were expecting the ZEV
market to " just take off " as incentives and
the federal government's sales mandate
pushed consumers toward ZEVs. But the
appetite has been just " lukewarm, " Hearn
said.
The perception of sluggish EV sales
doesn't square with the actual numbers,
said Ford Canada CEO Bev Goodman.
PHOTO: FORD CANADA
" It just comes down to price, " he said,
with buyers doing the math on whether the
lower cost of ownership of electrics can offset
higher upfront price. A growing number
of Canadians aren't convinced that the
trade-off adds up.
Canada's leading
ZEV adoption rate
of 28.4 per cent in
the second quarter
of 2024 and accounted
for 50.8 per cent of
all ZEV registrations,
according to S&P
data.
With the
cost-of-ownership
equation particularly
compelling in
Quebec, Hyundai
dealerships are having considerable success,
Flamand said.
They've " converted a lot of deals in
Quebec from somebody that maybe came
in with the idea of buying an [internal-combustion
engine] vehicle and leaving with a
Kona EV or an Ioniq 5, " he said.
Before incentives, the Hyundai Kona
Electric starts at $49,166 including delivery,
while the gasoline Kona, with less standard
equipment, starts at $28,920 including delivery.
Compared
with gasoline vehicles that
have similar content, the Kona Electric is
increasingly attractive from a total-cost-ofownership
perspective, Flamand said.
Yet the days of sky-high incentives in
Quebec are numbered. The province said it
would reduce its rebate to $4,000 per vehicle
at the start of 2025 and $2,000 in 2026, eliminating
it at the start of 2027.
As a result, Hearn and Flamand expect
ZEVs to take a hit in Quebec early next
year.
" We'll see some growth continue, but we
won't see as much as we're currently seeing, "
Hearn said.
Across Canada, the ZEV market is on a
similar trajectory.
Canada's ZEV registration growth,
quarterly, year over year
PHEVs
BEVs
ZEV SALES TREND
UPWARD THROUGH Q3
Automakers reported strengthening
battery-electric (BEV) and plugin
hybrid vehicle (PHEV) sales in
Canada. This roundup highlights
notable recent traction but does not
2022
2023
2024
provide a complete picture as not all
automakers consistently break out
sales by powertrain.
2023
2024
Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1
2023
BEVs
2019
2019
2020
2020
2021
2021
PHEVs
2022
2022
2023
2024
2024
Source: Statistics Canada
* General Motors: Marking its bestever
BEV sales quarter from July through
September, GM hit its stride with the new
Equinox EV and Blazer EV. Sales of the
two models totaled 5,702 and 1,596 vehicle
in the third quarter. The sale of 961
Cadillac Lyriqs represented a 203.2-percent
gain from a year ago.
* Honda: Sales of the Honda Prologue, the
brand's only BEV, which hit the market
this spring, were 132.
* Hyundai: Strong growth in Ioniq 5 sales
pushed Hyundai BEV volumes higher
in the third quarter. The company sold
3,634 of the crossovers during the threemonth
period, up 157.9 per cent from
2023. Ioniq 6 sales fell 27.3 per cent in
the quarter but were up 36 per cent for
the year.
* Mazda: Sales of the CX-90 which is available
with hybrid or PHEV powertrains,
rose 77.1 per cent in the third quarter to
2,876 vehicles. Volumes for the discontinued
MX-30 BEV fell to nine vehicles from
260 a year earlier.
* Mitsubishi: Sales of the Outlander PHEV
powered past 10,000 vehicles, through
the third quarter, notching a 37.6-per-cent
gain over the same period of 2023.
* Nissan: Gains for the Ariya tall wagon
have more than offset declining Leaf volumes
this year. Through the third quarter,
Nissan sold 2,484 Ariyas, 74.3 per cent
more than over the same period of 2023.
Leaf sales declined 7.5 per cent to 1,470
vehicles.
* Stellantis: Sales of the Dodge Hornet
PHEV rose 60 per cent in the third quarter,
despite a 60-per-cent decline in sales of
the gasoline-powered Hornet in the same
period. Fiat sold 381 500e's in the third
quarter, bringing the total to 653 since the
model went on sale this spring.
* Toyota: Posting gains across the board,
the brand saw growing demand for BEVs
and PHEVs. Sales of the bZ4X hatchback
reached 2,277 vehicles, up 89.6 per cent
from the previous year. The automaker
also posted record quarters for the RAV4
Prime and Lexus NX 450h PHEVs.
* Volkswagen: Sales of the ID4 crossover
increased to 7,741 vehicles, up 84.7
per cent from last year. A stop-sale order
issued in mid-September will halt further
gains this year.
* Volvo: Electrified vehicles, including
hybrids, accounted for 42.2 per cent of
total sales, with the XC60 PHEV crossover
leading the way. Sales of the new
EX30 tallied 377 vehicles.
Source: Automotive News Research & Data Center
While ZEV volumes continue to pick up,
growth is slower. The 37.9-per-cent growth
tallied by Statistics Canada in the second
quarter was the slowest rate of expansion
that the segment has posted in the past 18
months. And as volumes increase, blistering
ZEV adoption - which climbed to
a post-pandemic high of 160.8 per cent in
the second quarter of 2021 - will become
impossible to repeat. -ANC
Vehicles
Percentage change
Percentage change
Automotive News Canada - October 2024

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