Auto industry leaders presented a united front in Ottawa this morning at a joint press conference to express their continued concerns over the federal government’s proposed zero-emission vehicle mandates.
The groups expect the government to release slightly modified mandates next week that don’t go nearly far enough in considering all the concerns the industry has raised during the past year.
“Our main topic this morning on Parliament Hill was to deliver a message ahead of the EV mandates that we’re expecting to be announced next week and to convey that the mandates cannot succeed without Canadian consumer acceptance and the right market preconditions,” said Tim Reuss, President and CEO of the Canadian Automobile Dealers Association, in an interview with Canadian auto dealer. (Senior Editor Todd Phillips spoke with all three association leaders from Ottawa after their press conference.)
For his part, Brian Kingston, President & CEO of the Canadian Vehicle Manufacturers’ Association, said the government’s proposed mandates no longer reflect some key concerns the government flagged when they created the mandates, “I think we’re expecting perhaps some minor tweaking of the regulation that we saw almost a year ago at the time they’ll be making the announcement. So no significant changes despite a year’s long worth of discussions with industry on the challenges around the regulation,” said Kingston in an interview.
“One of the things that the government has been saying since it first proposed the whole concept of a mandate was that there’s no inventory, there are no EVs in Canada. We need a mandate to secure that. Well, the landscape has shifted dramatically. Of course there were inventory challenges during the pandemic and coming out of the pandemic because of global supply chain pressures. But if you look at recent data, now we have models in virtually every vehicle segment and inventories are increasing week over week for electric vehicles. So the whole premise of their mandate is no longer valid. And that’s what makes this particularly concerning is that why would you proceed given all of the things that automakers have done to bring more vehicles into the market?”
David Adams, President of the Global Automakers of Canada, said that while the auto groups would have more to say when Ottawa releases their updated mandates, he doesn’t expect a big change. “I think it’s going to be pretty consistent with what we saw in the draft regulation, annual targets increasing to a hundred percent with some modifications in some very specific areas, but I think it will look largely the same,” said Adams.
“I think for all of us putting the product into the marketplace is really one small piece of a very complex puzzle. And I think as Brian and Tim have said, we can do our part, but we need to ensure that we have the infrastructure in place,” said Adams.
In a press release about their appearance in Ottawa, the groups outlined their key concerns. “Canadians expect certainty that they can afford, use, and charge their EVs in a manner that suits their different lifestyles and geographical requirements before making one of the most important purchasing decisions in their lives,” said Reuss.
Reuss added that current high interest rates and high inflation have a big impact on consumer affordability, and so many people lack the means to actually buy an EV. Evidence of this can be seen when considering rising inventory levels on CADA dealer member lots. “Instead of attempting to dictate what individuals have to purchase, we suggest the government focus on creating the right set of circumstances to stimulate demand,” said Reuss in a statement.
The leaders continue to make the case that the industry is not dragging its heels on introducing electric and electrified vehicles, citing the massive global investment in new manufacturing capacity. “The auto industry is completely committed to this transformation and that’s what makes this mandate frankly so redundant. Automakers have committed over a trillion dollars to electrification globally. In Canada, we’ve seen $30 billion in new investment over the past few years with a huge proportion of that dedicated to electrification,” said Kingston in an interview.
He said automakers have brought 77 models into the market in Canada with another 41 expected next year. “So the industry is going down this path already and making massive investments in the transformation. And the challenge with the mandate is by dictating what Canadians can and can’t buy without ensuring that first we have all of their required support, you’re actually going to challenge the ability to transition for most Canadians,” he said.
Expect to hear more from the leaders once the government officially releases their mandates.
