Canada Electric Vehicle Market By Vehicle Type (Two Wheelers, Passenger Cars, Light Commercial Vehicle, and Medium & Heavy Commercial Vehicle), By Propulsion Type (Battery Electric Vehicle, Plug-In Hybrid Electric Vehicle, and Fuel Cell Electric Vehicle), By Range (0-50 Miles, 51-150 Miles, 151-200 Miles, 201-400 Miles, and Above 400 Miles), By Battery Capacity (Less Than 50KWh, 51KWh to 100KWh, 101KWh-200KWh, 201KWh-300KWh, and Above 300KWh), By Region, Competition, Forecast and Opportunities, 2028

Canada electric vehicle market is growing at a robust CAGR due to several reasons, such as technological advancement in the electric vehicles (EVs) space, decrease in ownership cost of the electric vehicles, and increase in taxes upon vehicles powered with internal combustion engines. Furthermore, the surge in government initiatives is encouraging infrastructural development and attracting more investments in the electrification area which is significantly contributing to this market’s growth.

Canada Electric Vehicle Market Scope

The adoption of electric vehicles is happening at fast pace in Canada. The country is focusing heavily on reducing greenhouse gas emission by 2030. The Canada electric vehicle market is segmented into various categories to calculate its size. These categories include vehicle type, propulsion type, range, battery capacity, and region. Based on the vehicle type; the market is divided into two-wheeler, passenger cars, and commercial vehicles. Commercial vehicles are further divided into light commercial vehicles and medium & heavy commercial vehicles based on their gross vehicles. Based on the propulsion type, the Canada electric vehicle market is divided into as battery electric vehicle (BEV), plug-in hybrid electric vehicle (PiHEV), and fuel cell electric vehicle (FCEV). PiHEV are electric vehicles which are powered by both internal combustion engines and battery. The batteries in this type of vehicle can be charged internally with the engines and with the external charging cable also. Fuel cell electric vehicles are powered with the electricity generated through compressed hydrogen and are more efficient than the conventional combustion engine vehicles. The electric vehicles have different ranges up to which they can travel. Therefore, based on the range the market is further divided as follows; 0-50 miles, 51 miles – 150 miles, 151-200 miles, 201-400 miles, and above 400 miles. Further, motor vehicles differ from each other based on power and features. So, they require distinct batteries based on their operational requirement. Thus, based on the battery capacity, the market is divided as; less than 50KWh, 51KWh-100KWh, 101-200KWh, 201-300KWh, and above 300KWh.

Canada Electric Vehicle Market Overview

The Canada electric vehicle market is expected to grow at a faster rate in forecasted period. The market is significantly driven by the government initiatives to discontinue the internal combustion engine vehicles, declining cost of electric batteries, and more taxes on emissions.

Shifting to the electric vehicle is also helping people from the fluctuating cost of gas and oil prices which are particularly affecting these days due to geopolitical issues such as Ukraine-Russia war. The transport sector in Canada is a priority of government to transform it in net zero emission as soon as possible because this sector is responsible for major greenhouse gas emission. Technological evolution has highlighted some valuable findings which are going to boost the adoption rate of electric vehicles in the country. Some of the findings includes reduced maintenance cost of electric vehicles especially for the commercial vehicles because in Canada commercial vehicle sales are higher than the passenger cars. Further, efficiency of the electric vehicles is higher than the vehicles powered by the combustion engines which means it would be cheaper to operate EVs even in areas with higher electricity costs. Therefore, in long run, the electric vehicles are going to outpace the internal combustion engines in the country because of the ecofriendly and cost cutting benefits that are associated with them.

Canada Electric Vehicle Market Drivers

The Canadian government has implemented the carbon tax, which has been increasing from the past few years and is expected to increase further in the forecast period. This is resulting in the rise of fuel prices in Canada. The carbon tax basically puts a price on the carbon pollution created. This tax law is increasing the operating cost of vehicles with combustion engines and thus, is resulting in the faster adoption rate of electric vehicles in the country.

Canadian government is investing for the strong battery supply chain within the country. The federal and state provinces are collaborating with private partners to create large-scale domestic EV battery manufacturing plants in Canada. For example, recently, the federal government and Ontario government have jointly invested about 5 USD billion with two private partners to set up Windsor plant which will manufacture the lithium-ion battery cells. These kinds of developments are helping in maintaining the prices of EV battery in market which is ultimately making the electric vehicle prices within the reach of majority of population.

The Zero Emission Vehicle Infrastructure Program (ZEVIP) is introduced by the Canadian government to increase the deployment of charging stations across the country. The government has sanctioned around 680 USD million for this infrastructural development. By increasing the availability of these stations, demand of electric vehicle might increase in Canada.