An electric Hummer and Caddy? Auto show offerings grow, but can infrastructure support an EV world?

For years, electric vehicles were the car of the future. Now, they're very much in the present.

While Tesla might still be the biggest name in the field, a growing number of carmakers, many with displays at the Canadian International Auto Show which opens Friday, are moving into the electric vehicle game. And sales are showing it's more than just a niche market with a wider variety of vehicles including an all-electric Hummer, and, for the first time, an all-electric Cadillac, an SUV called Lyriq.

There's also the all-Canadian Project Arrow, a prototype electric SUV produced by 58 companies under the leadership of the Automotive Parts Manufacturers' Association.

What's driving the growth is the huge amount of product we're getting," said veteran auto industry analyst Tyson Jominy, VP of data and analytics at J.D. Power. We've got 36 series of EVs on the road right now, and 50-something models underneath those. And that's basically going to double this year."

EV sales at 10 per cent of North American market

Jominy says the growing number of models is the biggest factor in an EV sales boom that accounts for nearly 10 per cent of the North American market.

In Canada, purely electric vehicles made up 3.6 per cent of all light vehicle sales in 2021, the most recent year for which Statistics Canada has numbers available. But add in hybrids - which also have a gas-powered internal combustion engine - and that number is 10 per cent. In 2020, that same hybrid-included number was 6.2 per cent. In 2019? Just 4.9 per cent.

What we're seeing is filling in the white space in the industry right now," said Jominy. And that consists of first getting pickups in the market, then filling in all the SUVs, and away we go. The number of EVs entering the market will drive it higher and higher."

Different categories of vehicles, and perhaps even more crucially in the brand-loyal world of auto consumers - familiar brand names - means there's now a much-wider pool of potential customers, Jominy added. Brand loyalty, Jominy estimated, accounts for roughly 50 per cent of consumer buying decisions in the automotive industry.

If they were intending to buy an EV, they've had enough options now for the last decade if they wanted to leave. People were waiting for their own brands to offer an EV," said Jominy. Right now every brand, with maybe the exception of Ram and Dodge, have something on the road."

Gas price hikes drive EV interest

Soaring gas prices last summer also helped give electric vehicle sales a jolt, Jominy said. In Canada last summer, people were paying more than $2 a litre for regular and in some areas of the U.S. it went as high as $8 U.S. a gallon for premium.

When you see gas do that, you start to consider alternatives pretty quickly," said Jominy.

But the rapid rise in electric vehicle sales is about to bump into some very real limitations, say Jominy and other auto industry insiders.

Flavio Volpe, president of the APMA, points out that roughly a third of the Canadian population lives in multi-family buildings such as apartments or condo buildings, most of which don't have dedicated charging stations. In downtown areas, even many single-family homes don't have driveways, Volpe noted.

You're not going to be running a cable out to the street to charge your car," said Volpe.

EV infrastructure problems

That kind of basic stumbling block makes Volpe wary of proposed regulations from the federal government which is aiming to have 20 per cent of all new vehicle sales be electric by 2026, and 100 per cent by 2035. The regulations also envision significant fines for auto companies for each non-electric vehicle sold below the target.

A lack of infrastructure isn't the fault of car manufacturers, Volpe argued.

Are they penalizing the companies that make the chargers? Are they penalizing the development companies that put up apartment buildings that don't have charging spots? Are they penalizing Toronto Hydro because they didn't up the capacity of the transformers and transmission stations?" asked Volpe. If you're not penalizing the ecosystem, don't penalize the companies that make the product."

The infrastructure shortfall is probably the biggest obstacle to electric vehicle sales right now, agreed Jominy.

In a lot of ways, we're out over our skis right now, because we're growing too fast and the infrastructure isn't keeping up."

Still, Jominy added, the infrastructure isn't the only obstacle. So is the reality that at current prices, electric vehicles are still outside the reach of many consumers. So too, he added, are many new cars, no matter what fuels them.

Ultimately, what we need to do is hit the lower end of the market. The sub-$30,000-space for any new vehicle, regardless of powertrain, has been largely abandoned since the supply chain crisis began," said Jominy. The industry needs to return to that space because that's where the volume is. Otherwise, we're just a permanently smaller industry going forward."