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Report On Business Ontario’s target for electric vehicle sales doesn’t add up

The Ontario government’s newly unveiled climate change plan outlines a target of 5 per cent of the market for electric and fuel-cell powered vehicles by 2020.

Fred Lum/The Globe and Mail

The Ontario government's climate-change plan sets a goal for electric vehicle sales that is based on a number that dramatically understates overall new vehicle sales in the province.

The plan, unveiled by Premier Kathleen Wynne and several cabinet ministers on Wednesday in Toronto, outlines a target of 5 per cent of the market for electric and fuel-cell powered vehicles by 2020.

"For context," the government document says, "about 284,000 passenger vehicles were sold in Ontario in 2015." That number means the 5 per cent target translates to electric vehicle sales of about 14,000.

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The problem is that the 284,000 figure for sales of new passenger vehicles in Ontario understates the actual number by more than 50 per cent. Auto makers sold 760,511 passenger vehicles in the province last year, according to data from the car companies and compiled by DesRosiers Automotive Consultants Inc. So a target for electric vehicles based on the correct figure would be sales of 38,000 by 2020, much more difficult to reach than 14,000.

A government spokesman said 284,000 is a number calculated by Statistics Canada. The Statscan website shows that number as sales of passenger cars in Ontario, excluding minivans, sport utility vehicles, light and heavy trucks and large vans and buses.

Minivans are the ultimate passenger vehicle, and sport utility vehicles – including crossovers – are also purchased almost entirely to carry passengers. Dennis DesRosiers, president of the consulting firm, said if all commercial vehicles are removed from the 760,511 figure, passenger vehicle sales in Ontario still amounted to at least 650,000 in 2015.

Crossovers are the biggest segment of the passenger-vehicle market, and many brands offer plug-in hybrid electric versions.

"It's puzzling why they decided to look only at part of the total vehicle sales in the province as opposed to the whole number," said David Adams, president of the Global Automakers of Canada, which represents car companies based in Asia and Europe. Mr. Adams said that selling 14,000 electric and fuel-cell-powered vehicles by 2020 is "certainly" a lot more achievable than 38,000.

A government spokesman said Ontario used what it called "widely accepted" data from Statistics Canada.

"The key is how quickly consumers are going to adopt these things," Mr. Adams said. He pointed to incentive money, such as grants of up to $14,000, that the province will give buyers of some electric vehicles, growth in the number of vehicle charging stations in the province and education of consumers. New incentives include, as The Globe and Mail reported last month, subsidies to low- and moderate-income buyers of electric vehicles.

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"So far, if you look at the [sales] numbers in Ontario and across Canada, they're improving on a percentage basis, but on an overall basis, they're not improving anywhere near the levels they need to improve to reach the targets that various governments have put out there," Mr. Adams said.

Mr. DesRosiers challenged claims in the Ontario plan that consumers can save money if they choose electric over gas-powered vehicles. The average depreciation rate of battery-powered vehicles is between 40 per cent and 50 per cent when they drive off the lot, compared with 10 to 15 per cent for those that use internal combustion.

So far, he said, sales figures indicate consumers have overwhelmingly rejected electric vehicles. Electric and hybrid vehicles captured less than 1.5 per cent of the market in the province last year.

"What are we going to do, force consumers to buy them?" he asked.

The government said it worked with auto makers to find "the right balance to reduce greenhouse-gas emissions and make Ontario businesses more competitive."

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