Majority of Canadians seeking an EV amid rising living costs: EY

• 49% of Canadians say high fuel costs are the primary motivator for buying an EV
• 24% of potential buyers are concerned by a lack of charging stations, down from last year
• Alberta (40%) and Quebec (43%) are provinces with the lowest intent to purchase an EV

Toronto, ON (Aug. 28, 2023) – Consumer appetite for electric vehicles (EVs) is at an all-time high in 2023, according to the latest EY Mobility Consumer Index. Rising fuel costs, environmental concerns and new government incentives are pushing 52% of Canadians to consider purchasing a fully electric, plug-in hybrid or hybrid vehicle in the next few years — a 6% spike in buying intent compared to 2022.

“The rising cost of living is showing consumers that buying an EV is a more viable, sustainable option,” explains Jennifer Rogers, Automotive and Transportation Leader at EY Canada. “But as fuel prices gradually subside and we return to more favourable and affordable economic conditions, the challenge for manufacturers will be maintaining this momentum and making sure that interest in electric cars persists down the road. Collaboration between manufacturers, energy companies and governments at all levels will be key to meeting drivers’ needs while progressing along the national energy transition.”

Environment no longer the top motivator for purchase

The survey shows that Canada is among the highest countries with cost-of-living concerns, driving new motivators for consumer purchasing. For the first time, increasing fuel price (49%) is the top motivator for making the switch to an electric car, surpassing environmental concerns (40%), increasing penalties on internal combustion engines (ICE) vehicles (24%), cost of ownership (24%) and monetary incentives (23%).

Government incentives justifying EV cost premiums

This year, 75% of Canadians say they would pay a premium and of those three-quarters of consumers say they’re willing to pay up to 30% more than they would for an ICE vehicle. This is, in part, due to recent government incentives such as the federal government’s national energy transition strategy, which are encouraging more consumers to turn to EVs over ICE vehicles.

While EV interest in Canada lags the global average of 55%, it exceeds purchase sentiment in the US (48%) and Australia (37%). However, intention varies by region. Respondents in Ontario (59%) and Atlantic (58%) express the highest interest, with Alberta (40%) and Quebec (43%) sitting on the lower end of the spectrum.

“EV uptake varies considerably among provinces with different incentive programs and grants,” justifies Rogers. “Strong incentive programs could help eliminate some of those gaps and create a more equitable path to EV ownership — all while supporting the national energy transition.”

Battery replacement emerges as new concern in preventing purchases

Upfront cost continues to be the top inhibitor to purchase (44%), up 6% from 2022. Meanwhile, concerns around limited electric vehicle charging stations (24%) are down 12% from 2022. This concern lags limited battery range as the second highest concern (35%). Two new additions to the list in 2023 include 24% of respondents citing they’re still more comfortable with ICE vehicles, as well as 24% sharing that expensive battery replacements are inhibitors to purchasing an EV.

About the Mobility Consumer Index

The EY Mobility Consumer Index (MCI) provides unique insights on the shifts being witnessed in journey patterns, modal choices, vehicle buying and transition to electric mobility in the post-COVID world. Based on a global survey of more than 15,000 consumers across 20 countries (Australia, Austria, Brazil, Canada, China, France, Germany, India, Italy, Japan, Mexico, Netherlands, New Zealand, Norway, Singapore, South Korea, Spain, Sweden, UK, and US) during March 2023, MCI also aims to assess the consumers’ car buying journey while offering insights around their attitudes towards mobility choices and sustainability.

About EY

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SOURCE: Ernst & Young LLP

Tags: electric vehicles (EVs), EY, survey