Canadian Manufacturing

Ont. government pushing to become EV leader, but more incentives needed according to some

Ontario has secured investments from big automakers such as Ford and GM to build new electric vehicles at their facilities in the province in the coming years.

December 13, 2021  The Canadian Press

Doug Ford is pitching Ontario as the next electric vehicle manufacturing powerhouse, seemingly a far cry from the premier who three years ago cancelled incentives for people to buy them.

Where some see contradiction, others see calculated election strategy.

Shortly after coming to power in 2018, Ford’s government scrapped Ontario’s cap-and-trade system, and with it the electric vehicle rebates funded by that program.

He also stopped building charging stations — the provincial transit agency even removed some — and dropped a requirement for new homes to include the wiring for potential EV chargers.

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Ford at the time decried the rebates of up to $14,000 as subsidizing purchases for wealthy buyers — and he still does, mostly.

“Before the election I didn’t believe in giving millionaires rebates on over $100,000 Tesla cars,” he said last month. “I just didn’t believe in it. Let’s see how the market dictates.”

In the year after the rebate cancellations, the market for electric vehicles tanked in Ontario. At its highest point, electric-vehicles made up around three per cent of the province’s total passenger vehicle sales. That dropped to below one per cent after the rebate was scrapped.

The introduction of a federal rebate saw Ontario’s electric-vehicle sales begin to climb again. The most recent data from Statistics Canada puts the numbers back to nearly where they were before the provincial cancellation.

But that is still well below levels seen in provinces with their own rebates, such as British Columbia and Quebec, which are seeing electric-vehicle sales of about 13 per cent and 10 per cent, respectively.

Electric-vehicle advocates say Ontario can’t be a leader in manufacturing while being a laggard in sales.

Joanna Kyriazis, senior policy adviser at Clean Energy Canada, said a recently announced Ontario auto strategy was more friendly to electric vehicles than she would have expected, but it’s missing the second half of the equation.

“I do think that there’s been a recent shift in the Ford government’s view of electric vehicles, at least on the manufacturing side,” she said.

Ontario’s “Driving Prosperity” plan focuses on repositioning the province’s auto sector to build electric vehicles, as well as establishing battery production here, taking advantage of critical minerals found in the Ring of Fire. It aims to build at least 400,000 electric vehicles and hybrids by 2030.

Ontario has secured investments from big automakers such as Ford and GM to build new electric vehicles at their facilities in the province in the coming years, and the premier is looking to attract more.

“Our government knows it and the auto industry knows it: Ontario is the No. 1 place in the world to build the cars and trucks of the future,” Ford said when he announced the strategy last month.

Acting on the manufacturing side but not the consumer side is contradictory, said Daniel Breton, president and CEO of Electric Mobility Canada.

“If Ontario wants to be a leader, it’s not a buffet where you pick and choose what you decide to do,” he said.

“Rebates do make a difference. They don’t have to be $14,000, but if people see a decent rebate or even tax credit I think it does make a difference, not only in a financial point of view. There’s a social point of view that says the government is really promoting the transition to electric vehicles.”

But the political aim of this government, strategists say, is the focus on jobs.

Ford is trying to secure manufacturing in regions like Oakville and Windsor, whereas Liberals look at the issue through a consumer and environmental lens, said Andrew Steele, a vice-president at consulting firm StrategyCorp.