Encouraging widespread adoption of new technology can initially be a challenge.
Take, for example, the case of the humble microwave oven. It took around twenty years of mediocre sales before it started to become a common household appliance in the United States. However, in the 1980s, the popularity of microwaves skyrocketed, and they quickly found their way into nearly every kitchen.
A similar trend is currently underway with electric vehicles (EVs). According to a recent analysis by Bloomberg Green, the rapid adoption of EVs is resembling the fast section of the technology adoption curve.
About a year ago, Bloomberg’s analysis revealed that 19 countries had reached a crucial tipping point, where five percent of new car sales were electric-only. This milestone marks the beginning of mass adoption.
Since then, five additional countries have joined this group. And one of them is Canada.
Canada is now part of a cohort that includes the United States, China, and most of Western Europe. The trajectory set by these early adopters showcases the potential for EVs to grow from five percent to 25 percent of new car sales in just four years.
The EV adoption curve
When a new technology is introduced, sales tend to start off slow during the early-adopter phase and then accelerate once the technology becomes mainstream. This trend has been observed for appliances such as televisions, mobile phones, and LED lightbulbs.
In the case of fully electric vehicles, reaching the five percent mark appears to be the turning point. The time it takes for countries to reach this level can vary widely. However, once the challenges related to car costs, charger availability, and driver skepticism are overcome, the mass market tends to follow suit.
In the United States, the EV tipping point was only recently reached in late 2021, which is relatively late considering the country’s economic power. Several factors contributed to this delay.
Americans spend more time in their cars compared to other nations, and they demanded longer driving ranges than early EV models could provide. Additionally, pickup trucks and large SUVs make up a huge chunk of the US market. These vehicles have taken longer to electrify due to their substantial battery requirements.
Currently, EV sales in the US are increasing rapidly. According to the Financial Post, sales grew 42 percent in the second quarter compared to the same period last year.
EV growth could soon accelerate even faster. Tesla, the world’s largest EV manufacturer, is about to launch its Cybertruck pickup. And other American brands like Chevy, Ford, Jeep, and Ram will soon introduce their own EVs.
India, the third-largest automobile market globally, may also be approaching a tipping point. EVs accounted for three percent of new car sales in the country in the second quarter. This was twice as high as six months earlier.
Countries that have already crossed the five percent tipping point are experiencing rapid EV adoption. These countries had a median sales growth of 55 percent in the second quarter. However, growth rates are expected to slow down as the market approaches saturation.
There will always be some resistance to change, as evidenced by countries like Norway. Norway has the highest rate of EV adoption in the world. However, growth began tapering off after EVs reached 80 percent of new vehicle sales.
The state of the EV industry in Canada
According to a March 2023 report in The Globe and Mail, Canada’s overall EV adoption rate is 2.3 per 1,000 people.
Among the top 10 metropolitan areas ranked by EV adoption, two are located in British Columbia and eight are in Quebec. Squamish, BC, has the highest rate of EV ownership in the country.
The popularity of EVs in BC and Quebec is not a coincidence. Both provinces have implemented sales targets for zero-emission vehicles (ZEVs). Quebec has had targets since 2016 and BC has had them since 2019.
In December 2022, the federal government proposed its own ZEV targets. It used BC and Quebec as examples of how sales targets increase the EV adoption rate.
The proposed federal ZEV sales targets would require a minimum of 20 percent of new vehicles sold in Canada to be zero emission by 2026 and at least 60 percent by 2030. By 2035, all new cars sold in Canada would be ZEVs.