Tapping into consumers’ lifestyle needs as well as their concerns about climate change are key to accelerating the adoption of electric vehicles, according to a panel of Canadian auto and financial industry executives.
“We have to be more than ever very geared to what the consumers are looking for,” Pierre Boutin, CEO at Volkswagen Group Canada told an Automotive News Canada Congress Conversations executive roundtable on electrification.
“This is how we can build a winning strategy moving forward.”
- To see the entire panel discussion — and presentations from other speakers — register for on-demand access of the Automotive News Canada Congress Conversations here.
In 2020, EVs accounted for only 3.5 per cent of new car sales in Canada, according to Statistics Canada. One of the main barriers of consumer adoption is the price gap between EVs and gasoline-powered vehicles.
But Boutin said demand will grow as EV prices decline. He estimated that the cost of manufacturing batteries would drop by about 50 per cent between 2025 and 2027.
Growing concerns about climate change also will help to spur EV sales, said Neil McLaughlin, group head, personal and commercial banking, Royal Bank of Canada.
“Where we see consumer sentiment [is] this rapid upswing in terms of this focus on climate,” McLaughlin told the roundtable moderated by Automotive News Publisher Jason Stein. “The pandemic has entrenched in a lot of Canadians, ‘I have a responsibility to the community’ ... driving an EV is something they can do and feel good about their choice.”
Boutin said industry has a role to play in educating consumers on the environmental benefits of driving an electric vehicle.
As well, automakers have to offer EVs popular with drivers.
“Eighty five per cent of the market is geared towards SUVs and trucks in Canada,” said Boutin. “So, we’ve got to make sure that we can also not only bring this new powertrain technology called electric vehicles, but also tailoring the taste of what consumers are looking for.”
Technological changes transforming the industry are attracting a new type of consumer – one that wasn’t necessarily interested in the automotive or mobility industry in the past, but is now paying closer attention to it, said Elias El-Achhab, vice-president and COO at Kia Canada. “The newer generation… they’re coming to the party. They’re recognizing the need to have mobility, to have a vehicle,” said El-Achhab. “And I think that’s where we have to pay a little more attention to make sure we’re prepared for this new type of consumer.”
New mobility services “are going to give people more options, more economical options, more flexible options,” he said. “Perhaps, instead of two cars in the driveway, it’s one car and a mobility service for the second. I think there’s going to be secondary markets, no different than Airbnb and what they have done on the hotel business. I think you’re going to see the same sort of effects start to happen on the automotive side.”