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Ontario likely to fall short on EV target

Map of proposed EV chargers in 2016. Source: mto.gov.on.ca

Ontario appears behind on its aim to increase EV sales to 5% of total vehicle sales by 2020, but other developments in the sector are cause for optimism

Ontario is likely to miss its EV target for 2020. The populous Canadian province offers tens of millions of dollars in subsidies and intends for EVs to make up 5% of vehicle sales in 2020 – yet in 2016, the latest year for which data is available, that number was less than 1%.

“The chances of meeting [the 2020 goal] aren’t low, they’re zero,” car industry analyst Dennis DesRosiers recently told Canadian Press (CP). “In the auto sector, all roads lead to electric, it just happens to be that the road to serious acceptance of them is probably at least 2030 and more likely 2040, 2050.”

Tony Faria of the University of Windsor agreed. “We will almost assuredly get to five per cent electric vehicles purchased or on the road at some point in time, it’s just not going to be in the next couple of years,” he told CP. “We’re really wedded to our gasoline-driven vehicles because of the flexibility they give us distance wise, amazing availability of where you can fill up and so on,” he told the news agency.

That is despite the provision of considerable infrastructure and millions in consumer rebates. In July 2016, the regional government announced that its EVCO initiative would soon see over 500 new charging stations at more than 250 locations – a build out completed in March 2017.

However, EV advocates are less pessimistic. FleetCarma reported that in Q2 2017 EV sales represented 0.7% of the market, and although still a small percentage of overall volume, sales are up year-on-year by almost 100%.

Canadian Vehicle Manufacturers’ Association president Mark Natias also said that he believes there is a good chance of meeting the 2020 goal, but conceded that technology costs must still come down – as many EVs made by major automakers are loss leaders.

There is also hope for other parts of the EV supply chain. The town of Cobalt, Ontario (ironically originally created as a result of a silver mining boom) could soon be living up to the promise of its name, as demand for the element stokes renewed interest from mining exploration firms and investors. Amid concerns over the risk and ethics of sourcing cobalt from countries like the Democratic Republic of Congo, explorers are looking for new sources to feed the demand for batteries – indeed, Vancouver-based First Cobalt recently abandoned the DRC in favour of exploration closer to home.

In the automotive sector itself, Chinese EV maker BYD also plans to open a new truck factory in the province in 2018.

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Achieving the number of EV sales desired in the region may take time. The danger of an arbitrary 2020 target such as Ontario’s is that it relies on a ramp-up in consumer adoption, which either due to cost or technology, is perhaps not picking up as hoped. The results for FY2017, when they are available early next year, will offer better insight as to its progress.

However, Ontario is clearly still in line to play an important role in the manufacturing and supply chain, and with much of its infrastructure already in place, results should not be too far away.

 

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