This is the first in a three-part series, The Real Cost of Electric Vehicles, that delves into the future of electric vehicles and the impact electrification will have on Windsor Essex. Tomorrow we will look at the environmental impact of this change. On Thursday, we’ll look at the impact on employment in Windsor Essex.
Both the government and automakers are pushing car owners to move to electric vehicles (EVs), but astronomical prices threaten to put them out of reach for many Canadians. .
In other words, the federal government wants all passenger cars sold in Canada to be electric by 2035, but that won’t be realistic unless prices become more affordable to the average consumer. may not be what you expected.
James Godfrey, general manager of Eastway Toyota and Lexus of Windsor, said electric cars sell for far more than internal combustion engines and hybrids. Also, supply chain problems have caused auto prices in general to rise significantly in recent years, he said.
Conversing with customers about budgets is “really difficult,” he says in front of hybrid vehicles at the East End dealership. That’s especially true if they go electric.
The average consumer cannot afford to buy these cars.– Edgar Faler, Senior Industry Analyst, Center for Automotive Research
Prices for all vehicles are rising across the board, but Godfrey says customers are looking at prices of $55,000 or more for fully electric cars in his dealerships in most cases. .
Prices for EVs currently available in Canada range from $39,498 to $189,000. According to the Canadian Automobile Association.
“This technology is expensive,” Mark Stewart, COO of Stellantis North America, told the CBC. On average, he said, electric vehicles are 40 to 45 percent more expensive than conventional internal combustion engine powertrains.
For those looking for lower prices, Godfrey said:
It’s not just because it costs more. The supply is also thin. Again citing supply chain issues, Godfrey says we probably won’t get a fully electric car at a dealership until 2024.
Prime Minister Justin Trudeau acknowledged the long waiting list for electric vehicles across the board during a visit to the Windsor assembly plant in January.
“We know the demand is very high,” Trudeau said.
“We will continue to make sure we are investing in the facilities we have invested in over the past year and will ensure that we are able to meet as we see significant investments made in Canada in our zero-emissions ecosystem. It’s the growing demand and the excitement Canadians have for electric vehicles.”
See | James Godfrey describes “tough” conversations with people looking to buy a car from their land:
The general manager of Eastway Toyota in Windsor said it can be “very difficult” to talk to budget customers looking for all kinds of vehicles, not just electric ones.
Are new cars becoming out of reach?
Meanwhile, Canadians are already suffering from inflation and rising prices for essentials such as food and housing. It is shown to have the fifth largest income inequality.
It found that the average after-tax household income in Windsor Essex was $73,000, lower than the Ontario median of $79,500. In Windsor, it’s $63,600.
11.3% of Windsor area households were found to be low income, compared to the national average of 11.1%.
The Federal Reserve Bank of Chicago recently hosted its 29th Annual Automotive Insights Symposium in Detroit. Panelist Charlie Chesbrough, senior economist at Cox Automotive, noted that vehicle prices, from used cars to electric cars, are soaring that ownership is out of reach for most people.
“New cars may not have been a one-size-fits-all in America. We’d like to believe so, but they probably haven’t been for a long time, but not today,” Chesbrough said. says Mr.
He points out that the supply chain is improving, but not the high costs.
He isn’t convinced automakers have much incentive to make cars more affordable and abandon the current “seller’s market.”
Ronnie Smith, president of On The Road Lending USA, said at the symposium that his organization has a mission to provide affordable auto loans to low- to middle-income Americans. Told.
“Transportation is a major barrier to the ability of low- to middle-income families to live their best lives,” he said.
“Each low-income individual is affected differently when we talk about the current environment in which we find ourselves.”
Watch | James Godfrey says even used car prices at his dealerships are higher than they used to be.
Eastway Toyota’s James Godfrey talks to CBC’s Katerina Georgieva about things he might consider if he wants to buy a car from his dealer on a budget.
Government hopes kickbacks can help
Edgar Faler, a senior industry analyst at the Center for Automotive Research in Ann Arbor, Michigan, said the industry needs to find a solution to the affordability problem, especially when it comes to electric vehicles.
“They have to become affordable,” he said.
“The average consumer cannot afford these vehicles as they are secondary vehicles in many homes and are often a luxury purchase. We need to change the situation if we are to reach our ambitious target by 2035.”
Stewart said the more competitive the company becomes, the more consumers will be able to buy electric vehicles.
The federal government hopes the rebate will help bridge some of the gaps.
Launched in 2019, the company’s program offers rebates of $5,000 on fully electric vehicles and $2,500 on hybrid vehicles at certain price points. Last year it was expanded to include larger vehicles.
In Ontario, the Progressive Conservative Party, led by Doug Ford, canceled an electric car reimbursement program in 2018, with no intention of reinstating subsidies.
The CBC has reached out to the state’s Department of Economic Development, Job Creation and Trade to ask what the government is doing to make electric vehicles more affordable and whether it is considering reintroducing the rebate. I was.
A ministry spokesperson didn’t directly answer questions about affordability, but said the government had taken a “different approach” on the issue of EV credits. are investing to
In the city, where the Windsor assembly plant and new Stellantis-LG electric vehicle battery plant are set to begin manufacturing electric vehicles and the batteries that power them in the next few years, Unifor Local 444 president David Cassidy said that in the future: Everyone will be able to drive an EV.
“They need to make sure they’re focused on the fact that it should be good for all Canadians.”
Godfrey agrees. He predicts that manufacturers will find they need to bring their prices down.
“We want to be able to sell these vehicles, so we’ll find a way to distribute those vehicles to consumers,” he says.
“I hope we’re not in these long-term financial contracts that extend to longer periods, instead of seven or eight years. I hope we don’t become mortgage companies with financial contracts that involve batteries. Electric vehicles.” “
