Demand for zero-emission vehicles, or ZEVs, is small in Canada; they account for less than one per cent of total vehicles sales in this country.
But one province, Quebec, hopes to change that. Bill 104 is legislation aimed at increasing the number of ZEVs in Quebec in an effort to reduce greenhouse gases and other harmful emissions.
While the intent may be respectable, the consequences could be disastrous, according to John White, President and CEO of the Canadian Automobile Dealers Association (CADA). “It’s going to be extremely disruptive to the market, consumers, and dealers. It’s going to limit vehicle availability. It’ll force manufacturers to shift vehicles around. It’ll also force consumers perhaps to go to neighboring provinces to buy cars,” says White.
“And let’s say a manufacturer doesn’t achieve their targets, then there are certain penalties they’ll have to pay and who do you think is going to pay for that eventually?” he asks.
Bill 104 sets aggressive targets, beginning next year. Car companies would have to achieve ZEV credits equal to 3.5 per cent of their Quebec sales in 2018, jumping to 22 percent by 2025. Manufacturers who fall short of credits will face fines.
“Mandating vehicle companies to sell anything is a lost cause,” according to Canada’s leading auto analyst, Dennis DesRosiers. “The number one problem with all of these regulations — ZEVs, fuel-efficiency mandates, CAFE [Corporate Average Fuel Economy] standards — is they got the wrong target. It’s not the vehicle companies that determine the fuel efficiency or what vehicles consumers buy. It’s the consumer. That’s one of their fundamental problems — you can’t force a vehicle company to sell a certain number of vehicles that consumers fundamentally don’t want to buy.”
The legislation also punishes car companies, like Mazda, which DesRosiers says has the most fuel efficient mix of mass-market vehicles in Quebec. “They’re good little cars, but they don’t have a hybrid. They don’t have a battery-electric vehicle. They don’t have a ZEV — nothing. So putting a ZEV mandate in place essentially penalizes the company that does the most in terms of fuel efficiency in the marketplace,” he adds.
There are 26 million vehicles currently on the road in Canada; 11 million of them are more than 10-years-old and have no modern fuel efficiency technology. Nearly two million of those older vehicles are in Quebec. “Rather than forcing consumers into vehicles they currently are rejecting because the technology isn’t developed enough, a much smarter policy is to encourage them to buy a new vehicle and get the old ones off the road,” says DesRosiers, who in a recent study comparing the last 100 all-new vehicles introduced into Canada with their previous versions (i.e. new Toyota Corolla vs the old Toyota Corolla) found the average fuel efficiency improvement of a new vehicle in the last 100 vehicles introduced was over 25 per cent.
“If they really want to be effective and environmental they have to go after the consumer not the vehicle companies,” adds DesRosiers. A 45-day consultation period on Bill 104 is currently underway.
