Purchasing intentions decline despite sales growth
2024: A Record Year for Zero-Emission Vehicles, Yet Decreasing Electric Vehicle Purchase Intentions
(Montreal) The year 2024 marked a significant milestone in the sale of zero-emission vehicles (ZEVs) both in Quebec and Canada as a whole. A intriguing finding, however, reveals a consistent decline in electric vehicle (EV) purchase intentions, as per a recent survey by AutoHebdo.
In the realm of ZEV registrations, which includes electric vehicles and rechargeable hybrids, Statistics Canada reports an astounding nationwide figure of 270,985 for 2024. The data also indicates that nearly 15% of new vehicle registrations nationwide were ZEVs.
Quebec leads the pack among provinces because a staggering 126,657 new ZEVs were registered - an impressive increase of over 50% compared to the previous year. This points towards a bright future for EVs in the province.
A Paradox Arises
Despite the optimistic sales figures, a noticeable decrease in interest in EVs on AutoHebdo's website has been observed, even though the stock has increased significantly in recent months. Benoit Laforce, executive vice-president of new vehicle solutions at AutoHebdo.net, stated, "We see a significant increase in purchases, yet since 2022, it's the third year that people we survey mention that they are less interested in buying an electric vehicle."
The AutoHebdo survey, conducted in February and March among its users, reveals that only 42% of non-EV owners would be open to buying a ZEV for their next vehicle, a decrease from 46% in 2024, 56% in 2023, and 68% in 2022.
Laurforce attempted to shed light on the paradox, commenting, "We see curves that are going in opposite directions, and we have a decrease in interest, which means that there will come a time when we will no longer see any progress due to this decrease in interest."
Potential Causes and Concerns
One possible explanation for the increase in electric vehicle sales could be the behavior of consumers who are rushing to take advantage of government incentives before they disappear, as per Mr. Laforce's hypothesis. However, he also expresses concerns about the withdrawal of certain incentives for buying EVs, arguing it could lead to negative repercussions on both the Canadian and Quebec markets.
Germany serves as a cautionary example, with a drop of 68.8% observed between August 2024 and August 2023 after the end of subsidies for electric vehicles in that country.
Uncertainties Ahead
The Quebec government has been gradually phasing out its Roulez vert program, which offers subsidies for buying electric vehicles. The program will come to an end on January 1, 2027, adding to the uncertainty surrounding the future of EV incentives.
Additionally, the Federal government announced the suspension of the Zero-Emission Vehicle Incentives (iZEV) program in January, with the outcome of future government policies remaining unclear.
The AutoHebdo survey demonstrates that nearly 7 out of 10 non-EV owners considering purchasing an EV would be influenced by government incentives.
Professor of Chemical Engineering and Materials at Concordia University, Karim Zaghib, predicts that electric vehicles will become cheaper than internal combustion engine vehicles by 2030. This is due to an increase in the usage of inexpensive and abundant minerals like iron and phosphate in battery production, as well as advances in energy density and reduced fast charging technology.
In conclusion, the average price of batteries for EVs currently stands between $125 to $130 USD per kilowatt-hour per battery pack. Professor Zaghib estimates that by 2030, when the price of batteries reaches $80 per kilowatt-hour, electric vehicles will be cheaper to purchase than conventional fossil fuel-powered vehicles.
The Liberals have introduced regulations requiring that 20% of all new passenger vehicles sold in Canada be zero-emission by 2026. The target increases annually, reaching 60% in 2030 and 100% in 2035. As EVs become more affordable and supply increases, the market will see significant changes in the coming years. The challenges posed by range anxiety, charging infrastructure concerns, economic uncertainty, and the elimination of federal incentives remain barriers to widespread EV adoption.
- In contrast to the nationwide increase of zero-emission vehicles (ZEVs), particularly rechargeable hybrids, in 2024, there is a noticeable decrease in the interest of ZEVs among potential buyers, as per the survey conducted by AutoHebdo.
- Despite the decrease in interest shown by consumers, Professor Karim Zaghib, a professor of Chemical Engineering and Materials at Concordia University, predicts that by 2030, electric vehicles (EVs) will become cheaper than traditional internal combustion engine vehicles due to advancements in technology, including the use of inexpensive minerals and improvements in energy density and fast charging technology.
- Although Quebec's EV sales have been remarkably high, with a 50% increase in 2024 compared to the previous year, the French-speaking province faces uncertainties due to the gradual phasing out of government incentives, such as the Roulez vert program and the suspension of the Zero-Emission Vehicle Incentives (iZEV) program.
- In the sports world, it is worth noting that, by 2025, Formula E, the electric racing championship, has planned to introduce a hybrid race car, blending electric and traditional combustion engine technology, signaling an encouraging step towards the integration of EVs in a variety of applications.
