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In Canada, new-car sales took a huge hit in April, plummeting nearly 75 per cent in April.Patiwit/Getty Images/iStockphoto

With gas prices at record lows, experts say that consumers may be more likely to forego electric vehicle purchases, opting instead for gas-guzzling SUVs.

Figures from an informal analysis of sales data by manufacturer circulated widely within the industry found that globally, March EV sales may have dropped around 15 per cent year-over-year. According to consultancy group Wood Mackenzie, global EV sales could plummet 43 per cent in 2020 – hitting around 1.3 million units by the end of this year compared to a 2.2 million sold in 2019.

Meanwhile, prices at the pump are less than a buck a litre in every province and territory, even with Ottawa’s new federal carbon tax added to the price as of April. According to GasBuddy.com, Nova Scotians are paying the cheapest price for gas at 72 cents a litre. British Columbians are seeing the highest gas prices at 95.9 cents a litre.

It’s not outside the realm of possibility for consumers to be tempted by the low price of fuel, admits Cara Clairman, President and CEO of EV advocacy group Plug’n Drive.

“Certainly there’s going to be a bit of a slowdown [in EV purchases],” she says. “There’s a slowdown in the purchasing of cars, in general. This will definitely delay things, but I’m still optimistic that it won’t be a massive setback.”

In Canada, new-car sales took a huge hit in April, plummeting nearly 75 per cent in April. Year to date, the market is down 36.7 per cent in Canada compared to this time last year.

“We’ve never, ever seen a drop like this,” says auto analyst Dennis DesRosiers, who believes this is the lowest April sales total since 1951. By year end, he estimates 400,000-500,000 units lost on an annualized basis, which would put the country’s total sales for the year in the range of 1.5 million.

That’s not to say that we won’t see new car purchases start to return towards the end of 2020. Although many people are struggling with lost jobs, income or self-isolation, DesRosiers points out that 600,000 retail leases are expiring this year. But with low gas prices, EVs might be a hard sell. He expects consumers to continue their love affair with bigger SUVs when they come back to the marketplace.

“Fuel prices are really critical to EV sales … This takes away the economic incentive,” he says. “It pushes it more to an environmental side. If you really care about the environment and climate change you still might consider an EV.”

So far, Clairman says she’s hopeful that the environmental factor will push EV sales moving forward. “The one thing this pandemic has done is we’ve had a huge improvement in air quality. Maybe people will think: ‘Maybe we can keep that going by changing the kinds of vehicles we drive, we could have good air quality all of the time,’” she says.

Futurist and author Nikolas Badminton, who has done research on the outlook of business, automotive, and technology, echoes some of Clairman’s optimism. Prior to COVID-19, 2020 was poised to be a typical year for electric vehicles, but “the pandemic has really put a kibosh on that, he says. “2021 is going to be a real bumpy year for electric vehicles.”

Long term, he sees sales and adoption rising once electric vehicle production itself becomes cheaper. He points to the fact that even amid the COVID-19 crisis, manufacturers are still committed to the EV cause. Honda and General Motors just announced a joint partnership to develop two all-new electric vehicles that’ll go on sale in North America in 2024.

And just because gas prices are cheap, it doesn’t mean people will automatically buy vehicles with internal-combustion engines [ICE]. Other factors are at play. Policies are coming into place to restrict how many ICE vehicles can be sold in the future. There are targets to getting internal combustion engines off the streets. So it won’t be about oil forever.

“I think we’re going to see the price of a barrel [of oil] firmly below $30 from this point forward for the rest of the decade,” he says. “The price of oil is going to continue to dip. And this is where the rest of the industrial world is going to have step in and enable electric super grids, renewable energy – that’s going to make fossil fuel and the use of their oil obsolete.”

“In the next 10 years, there’s going to be a lot of people jumping onboard the EV bandwagon,” he adds.

We just have to get through this pandemic first.

The popularity of electric bikes has soared as people look for a cheap way to commute in busy cities. Matt Bubbers explores e-bikes as a transport option, and what you need to know about sharing the road when riding one.

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