Ending the misguided EV mandate

Opinion

Prime Minister Mark Carney delayed implementing the electric vehicle (EV) mandate, thankfully (Carney zaps EV mandates… for now, Sept. 6).

But we need more than just a brief glimmer of sanity. It’s time to end this boondoggle. An unacknowledged motivating factor for the Liberals has been trying to stay ahead of the Opposition. This is given that the EV mandate is now in their crosshairs, mirroring the earlier carbon tax. No one needs personally to like Pierre Poilievre to recognize that he was proven correct on the carbon tax, and, similarly, makes valid points about the EV mandate.

An unfortunate Trudeau-era holdover, the EV mandate, true to form, was motivated by political optics and wishful thinking. Yet, it provides poor reductions potential, with other better options.

It imposes excessive costs on average Canadian families, especially under uncertain tariff conditions, and is unfair, favouring the well-off, especially where incentives are concerned. These problems also can be confirmed quantitatively.

The mandate will not noticeably diminish vehicle emissions, at least not until long into the future.

Problematically, reporting has focused entirely on annual EV sales, not their total proportion of the national fleet. It is true EV annual uptake grew rapidly, to almost 15 per cent in 2024. Starting numbers, however, were small, with even the 2024 result meaning 85 per cent of sales were still conventional.

Plus, in 2025, EV sales dropped precipitously. Having been available since 2012, EVs represent only around three per cent of total light duty vehicles, not moving the needle much. Projections of EV also have been habitually overestimated.

Meanwhile, conventional hybrid vehicles are still relatively important, more affordable and with many manufactured here. These represent a better near-term option.

In 2012, EV batteries were expensive, justifying high prices and incentives.

Now batteries cost 10 times less, but EV prices are rising. What happened?

Lower-cost options were abandoned, with the industry reorienting to expensive, up-market vehicles with higher profits. Price differentials have increased accordingly. Sure, EV operating costs are lower, by 70 per cent, but considering reasonable assumptions over a 12-year life, including financing costs, the savings cannot compensate for higher prices. EVs remain a dicey economic dilemma, especially for lower-income families where the option is “no car.” Why not, instead, support transit, as we showed a couple of years ago (Electrified transit is part of the solution, Jan. 30, 2023)?

The Trudeau government spent more than $2 billion on EV incentives since 2019. Yet, who benefited?

Multiple analyses confirm these went overwhelmingly to top income brackets. Generous funding went to those hardly needing assistance, highlighting unfairness. Again, why not transit?

More than 95 per cent of electric vehicles today are imported.

Given tariffs, should we really be subsidizing foreign vehicles, including those from the U.S., especially Tesla? The latter’s connection via Tesla CEO Elon Musk to U.S. President Donald Trump suggests “not a dime.”

One economically solid idea is medium-duty electric vehicles, especially those used for deliveries given e-commerce is still booming. Incidentally, these are made in Canada, so why not focus more on them? Options to repower medium-duty school buses to electric make economic sense too, so why not pursue such doable opportunities?

There are further subtle concerns. Dan Lett, interestingly, showed disdain for the Opposition leader, suggesting the latter’s claim that EV could translate to job losses is outlandish (Poilievre limps away from spectacular campaign crash, gets hit by fact-filled EV, June 23). Dan needs to be careful. I found the “credible estimate” he cited, suggesting that EV could create 300,000 jobs over 10 years.

Except it’s a consultant report for an advocacy organization; a competent group, but still an advocate with an agenda. And job gains only occur under overly optimistic assumptions. Looking at major public statements by the United Auto Workers in the U.S. and Volkswagen workers in Germany, it is easy to grasp the reality of job-loss concerns. EVs involve dramatically fewer parts, so inherently need less workers for assembly, part of the reason manufacturers show interest.

If we really want to create jobs and reduce emissions, why not provide strong support to Canada’s important canola industry? While the automotive sector was provided $5 billion funding, canola got a parliamentary secretary going to China. This hardly indicates any priority, even though canola is worth much more economically to the country. Domestic production of low-carbon fuels like renewable diesel and sustainable aviation fuel appear to make economic sense, especially for a severely threatened industry. These options also offer dramatic near-term reductions.

Mark Carney should see the writing on the wall regarding the EV mandate, and, just like the carbon tax, pre-emptively end it. There are other more-sustainable options, and, even without any mandate, people could still buy an EV if desired.

Robert Parsons teaches at the I.H. Asper School of Business, University of Manitoba.