Whoa, Canada! Neighbor to the North Mandates Electric Cars, Trucks By 2035

Canada has become incredibly competitive in the expanding future of electric vehicle manufacturing, with billions of dollars of investment in new battery and component manufacturing facilities across the nation. So it might make sense that the government is now moving in for the final punch against the looming global emissions issue by announcing a new gas car and truck sales ban. An escalating range of requirements will dictate what sort of vehicles are introduced to the Canadian auto market going forward, and our friendly neighbor's aggressive action could paint a picture of what the U.S. might expect in the near future.

Canada's so-called Electric Vehicle Availability Standard was announced back in 2021, but the arrangement has been finalized this week. The new rules call for a target of 20 percent of all cars sold by 2026 to be zero-emission vehicles, and that grows to at least 60 percent of cars sold in Canada by 2030; all new cars and trucks sold on dealer lots in Canada must have zero-emission powertrains by 2035, with one small caveat for plug-in hybrids (PHEVs) to continue for a few years, provided they have enough all-electric range.

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By comparison, the U.S. Environmental Protection Agency (EPA)'s proposed rules call for 67 percent of all new light-duty vehicles sold in the U.S. to be zero emission by 2032. California's guidance, separate from the EPA's proposal, requires 100 percent PHEV, EV, or FCEV (fuel-cell electric vehicles) sales by 2035, which 17 other states have agreed to follow. Canada's third-quarter 2023 sales reflected a 12 percent EV sales mix, and there was a 7.9 percent mix in the U.S. in the same period, with EVs expected to make up 13 percent of global vehicle sales this year, according to Reuters.

That "out" in Canada's new rules that PHEVs count comes with an asterisk: Those cars must come with an all-electric range of 80 km (50 miles) or more to remain eligible for sale until at least 2035. Tim Reuss, president of the Canadian Automobile Dealers Association, was not happy with the new rules, according to a quote from him viaReuters: "Regulating Canadians to buy EVs they can't afford, or charge, will be a made-in-Canada policy failure."Reutersalso reports that Canada's transportation sector accounts for as much as 22 percent of the country's carbon emissions. Success of the Canadian policies will depend on whether automakers can bring down the high average price of new EVs with more affordable models, and of course, it will require even more billions in national charging and power infrastructure investment.