Within five years, the top 12 global automakers could be producing as many as 13 million electric vehicles annually, a dramatic increase from current levels, a report by KPMG Canada predicts.
That has huge implications for Canada’s auto industry, according to the report, called Canada’s Automotive Future: Next-generation vehicles will change the industry as we know it, released Wednesday.
“We think five years is the hump when things will really take off,” Peter Hatges, partner and national automotive sector leader for KPMG in Canada, told Automotive News Canada in a telephone interview.
Currently, the world’s top 12 automakers, including Tesla, manufacture 65 million vehicles a year, of which electric vehicles (including plug-in and hybrids) represent only a few per cent, Hatges noted.
“The change won’t happen overnight, but the industry as we know it will be turned upside down,” Hatges said, comparing it to the rapid shift away from the horse and buggy after the invention of motorized vehicles.
The report comes just days ahead of the 2020 Canadian International AutoShow in Toronto. The theme of this year’s annual industry event, which opens to the public Friday, is Transformative Times.
While the traditional gas-powered internal combustion engine will still be around for years, the market for electric vehicles is poised to grow exponentially after 2025, driven in part by consumer concerns about greenhouse gas emissions and government commitments to hit climate change reduction targets, the report says.
“How we build cars, how they’re supplied, what components go into them, how we maintain them – these will all be completely overhauled,” Hatges said, noting the shift has implications for the 125,000 Canadians employed by the auto industry and another 400,000 working in auto services and dealerships.
Electric cars have far fewer components than internal combustion engines.
“You’re basically driving a computer on wheels,” Hatges said.
As a leader in automation and robotics, particularly along the Toronto-Waterloo corridor, Canada is well positioned to create more auto industry jobs of the future, the report says.
But only one Canadian assembly plant – FCA Canada’s plant in Windsor — is currently producing an electric vehicle, the Pacifica, the report notes. That represents less than 0.4 per cent of all global EV production, the report said.
One of the biggest challenges will be developing a network of electric charging stations that allows drivers to refuel quickly and conveniently on the road, the report says. Currently, Canada has just 7,700 public charging stations, of which only 500 are capable of providing a full charge in about 20 minutes.