According to a report from market research firm Gartner and as reported by the Canadian Underwriter, shipments of electric vehicles (EVs) — including buses, cars, vans, and heavy trucks — will increase by 17% in 2025. By 2030, more than half of all new vehicle models offered by automakers could be electric.
However, as tariffs are top of Canadians’ minds these days, experts are warning that North America’s escalating trade conflict with China could shrink the EV market. Gartner warns that “trade barriers imposed by the U.S. and the EU on Chinese EVs will impede the advancement of connectivity, autonomy, software, and electrification in these markets. Chinese EVs currently lead in these areas due to their advanced technology.”
Some experts say the trade conflict has already begun. On Oct. 1, 2024, the Canadian government imposed a 100% tariff on EVs imported from China, followed two weeks later by a 25% tariff on Chinese steel and aluminum. This could have the effect of fewer EVs on the market, leading to increased costs for consumers.
Just how many EVs are there in Canada, anyway?
Before Canada’s EV tariff was established in October, battery electric vehicle (BEV) registrations in Canada increased 57% from 2023 to 2024. Plug-in hybrid electric vehicle (PHEV) registrations increased by 75% over the first four months of 2024.
Standard & Poor’s attributes the increased adoption of EVs in Canada versus the United States as part of the Canadian federal government’s push to achieve climate change targets.
Through the federal government, up to $5,000 is available at the point of sale to Canadian individuals and businesses for the purchase or lease of light-duty ZEVs (zero-emissions vehicles).
Incentives are also available at the provincial level in B.C., Ontario, Quebec, New Brunswick, Nova Scotia, Prince Edward Island, Newfoundland and Labrador, and the Yukon. The Quebec government has officially adopted a new rule banning the sale of most new gas-powered vehicles by 2035.
Conversely, in Alberta purchasers of EVs pay an electric vehicle tax. EV owners in the province fork out an extra $200 to pay the annual fee, which, according to the provincial government, helps account for wear and tear on roads and makes up for the fuel tax that electric vehicle owners don’t pay.
Additional numbers via energyrates.ca include:
- In Alberta, ZEVs make up 4.31% of the market share.
- In Q1 of 2024, 46,744 new ZEVs (light and medium-duty only) were registered across Canada. From that number, 34,105 were BEVs and 12,639 were PHEVs. This represents 11.2% of the market share.
- HEV registrations nationwide reached 34,930 in Q1 2024.
- About $11.7 billion in fuel savings can be achieved for drivers if, by 2030, all new cars and SUVs and 75-80% of all new trucks sold in Canada are electric.
- The Canadian government has pledged over $1 billion to build 84,5000 EV charging stations by 2029.
Electric vehicle insurance
In the second quarter of 2024, claims related to EVs in Canada rose by 3.94%, marking a 39% year-over-year increase. Insurers spent an average of $6,534 to repair battery electric vehicles in Q2 2024, compared to $4,958 for internal combustion engine (ICE) vehicles — a 31% higher cost. The question now is whether these costs might decline amid the intensifying trade war.
In spite of that, however, several insurance agencies provide what is referred to as a “green vehicle” discount for EVs, including Aviva, one of our providers. Details include:
- Up to 10% off premiums when insuring an electric vehicle.
- Free tows to the nearest charging station when your EV battery runs out of charge on the roadside.
- A $2,000 subsidy for upgrading to an electric vehicle after a total loss.
- Coverage for loss or damage to your charging cable or station.
- Coverage for loss or damage to your vehicle including the battery (if it’s damaged as part of the loss) for a covered claim.
Lower auto insurance rates from Lane’s
Insurance brokers such as us at Lane’s have access to the very best policies available from Canada’s most respected auto insurance providers. We help you save by getting insurers to bid on your business. The end result is fantastic coverage at lower auto insurance rates. In addition, we also have access to a number of different types of discounts to help find you lower auto insurance rates. And we will never fail to ask if you qualify for each of them. We know the right questions to ask to ensure you get the best deal available.
Lane’s Insurance is a leading Alberta-based brokerage working out of Calgary, Banff, Edmonton and greater Alberta.
