Fuel prices are fuelling demand for electric vehicles, but inventory remains a challenge

The soaring cost of gasoline at the pumps is fuelling an accelerated demand for electric vehicles (EV) these days with sales expected to continue to grow despite some inventory challenges. 

Tim Burrows, a board member of the Electric Vehicle Society who runs its Mississauga chapter and produces the monthly webinar Canada Talks Electric Cars, said demand was growing “fairly heartily” before the escalation of high gas prices.

“That has fuelled the whole thing, of course. But even prior to that we were seeing a good ramp-up in EV adoption” Burrows says, adding that there are still challenges. 

“The amount of inventory out there — not just the inventory, but the form factor. Depending on what people need, you couldn’t always find an electric version. But that’s been changing very quickly.”

The market is heating up but…

Burrows says 2022 was keyed up to be a banner year for new electric vehicles and options, but this has been blunted by supply chain issues.

“We’ll know as the year rolls along how serious that is. It’s doing very well nationally. But everything’s not equal,” he says. 

BC, Quebec, and Ontario are seeing the biggest adoption rates — and that’s because two of those three have very robust purchase incentives, Burrows adds. 

“Ontario used to and we’re seeing now some recent incentive programs showing up in the Atlantic provinces. That’s having a huge impact on adoption.”

In Canada, there’s a $5,000 federal purchase incentive for people buying an electric vehicle. 

The Electric Vehicle Society is a not-for-profit organization with about 2,400 members and affiliates across Canada. Members are made up of either EV owners, EV enthusiasts, or people who just want to learn about electric vehicles.

Its pillars are public education and advocacy

Across the country all of the chapters are engaged with their local government to move things forward in electrification, Burrows says.

One of the barriers to EV sales is the cost as the vehicles are a little more expensive than a regular comparable vehicle. But Burrows says the gap is closing. 

“But what people don’t necessarily take the time to look at is the total cost of ownership,” he explains. 

“For many, many EVs today that are priced at a premium to their gas counterpart, if you own the car for three or four years and drive it a reasonable amount, you will make that premium back through gas savings, through maintenance savings and other cost-saving aspects of EV ownership.”

Burrows says sometimes people don’t take that into their calculations. 

“A lot of people just look at the sticker price and it scares a lot of people off.”

At least one previous challenge is easing up 

Another trend leading to a higher adoption rate of EVs is the growing network of accessibility to charging stations across the country. 

A number of recent government funding announcements have added to the network in Canada and Parkland has a strategy to build charging hubs, particularly throughout BC.

“Charging is one of those perceived concerns that really isn’t much of a concern for most people. But most electric car owners will refuel their vehicles at home,” Burrows says, adding 95% of the time EV owners refuel at home.

Accelerating the transformation 

William York, on the board with the Electric Vehicle Association of Alberta, said the association’s mandate is to accelerate sustainable transportation by raising awareness and educating Albertans.

“We often say that the only barrier to electric vehicle adoption other than vehicle supply is psychological. The EVAA exists to address those psychological barriers,” he says.

“People think they need a lot more charging stations than they actually do. There’s concerns about battery longevity, there’s concerns about winter performance, there’s concerns about lots of different things. A lot of these concerns are not appropriate.”

York says Alberta sales continue to grow at a very high rate. Currently, there are 3,500 battery electric vehicles as of March 31, 2021. But he expects that number to be much higher when the latest data is released in the near future.

“Certainly more interest due to the spike in gasoline prices. I know that a few different automotive manufacturers are saying that there’s more people in their dealerships, there’s more orders than ever. We’re saying right now it’s death by a thousand cuts for the gasoline vehicle.” York says, adding there’s a myriad of reasons to go electric and gasoline prices spiking is just another.

“Not only do you have gas prices spiking but you have electric vehicles with superior performance, superior safety, less maintenance costs, more convenient, you don’t have to go to a gas station.”

Still, one challenge remains 

Jim Gillespie, executive manager of the Calgary Motor Dealers Association says consumer interest in EVs has noticeably increased in Calgary but the big issue remains access to supply.

“It’s still a struggle for our dealers to get allocation from some of their manufacturers. Interest has certainly picked up. I’ve heard folks are walking in and they want a specific model. Inventory is a real challenge,” he explains

He points out that the lion’s share of EVs has gone to Quebec, BC, and Ontario. 

“So that allocation has never been great in Alberta and it takes time to have that increased and then, of course, couple that with everything else that’s going on with supply chain,” Gillespie adds.

“At the end of the day, they will sell more of them because eventually, they’re going to get the product. The interest is there but we’re still a ways away from mass interest in this market. We need government support. The feds have to do more and the province certainly has to do more if you want EVs to grow.”