Why Canada won’t hit EV targets

Canada’s goal of having electric vehicles (EVs) make up 60 per cent of new vehicle sales by 2030 is increasingly looking unattainable, according to the president of the Global Automakers of Canada, and it’s keeping his members awake at night.

In a presentation at the Talk Auto 2024 conference in the fall, David Abrams warned that the country is not on track to meet this aggressive target set by the federal government’s zero emission vehicle (ZEV) mandate.

Earlier this year, following his talk at the conference, the Canadian government announced it would pause its incentive program. In separate reports, both S&P Global Mobility and DesRosiers Automotive Consultants noted the plummeting sales of battery electric vehicles to start 2025 as, notably, Quebec began its scale back of incentives for BEVs. Abrams then joined other automotive group leaders in sharing his displeasure over the move.

“Based on the data they’re seeing, there doesn’t seem to be a pathway at this point for Canada to reach that 60 per cent sales target by 2030, which has a lot of my members, and the auto industry in general, sort of staying awake at night,” Abrams said before the removal of federal incentives was announced.

The ZEV mandate requires automakers to sell 20 per cent zero-emission vehicles by 2026, 60 per cent by 2030, and 100 per cent by 2035. However, Abrams noted that even more stringent provincial targets in British Columbia (90 per cent by 2030) and Quebec (85 per cent by 2030) are also likely to be missed.

A major challenge is the massive investment and infrastructure required to support widespread EV adoption.

“Canada is going to have to spend about $1.4 trillion and have to double its electricity generation capacity by 2050 to be able to meet these goals,” Abrams observed. “And the other factor related to the electricity generation is we need to get that installed about three times faster than we’ve been installing it over the course of the last few decades. So there’s serious challenges there.”

While EVs themselves only account for about a 20 per cent increase in grid capacity, the broader effort to electrify all sectors of the economy is putting immense strain on the power system, he noted.

The pandemic has also exacerbated issues, with chip shortages hampering EV production just as automakers were being pressured to ramp up zero-emission vehicle sales.

Abrams acknowledged the auto industry’s commitment to electrification, with about $1.4 trillion committed to the transformation. However, he warned that the pace of EV adoption remains a concern, especially as governments begin to scale back purchase incentives.

“If we want to continue to see EVs grow and penetrate the marketplace in a meaningful way, we’re going to have to have continued incentives in place,” Abrams said.

Without sustained support, the price gap between EVs and traditional internal combustion engine vehicles may remain a significant barrier for many Canadian consumers. Abrams noted that federal analysis suggested that there wouldn’t be price parity between ICE and electric vehicles until after 2035.

Photo info: Mercedes-Benz shows off its EV charging network at the 2025 Canadian International AutoShow in Toronto