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Carmakers pushing SUVs are slowing Canadian EV transition

Policymakers should introduce taxes on SUVs following a rise in sales over the last decade to boost the move to electric vehicles, says Canadian not-for-profit Environmental Defence.

Canada-based carmakers continue to prioritise the production and sale of highly polluting SUVs over electric vehicles (EVs), says advocacy organisation Environmental Defence in a new report. Sales of SUVs constituted 80% of all vehicle sales in Canada in 2020, compared to 3.5% for EVs (including hybrids), according to the organisation.

President of Toyota Motor Manufacturing Canada Fred Volf with the Canadian Prime Minister Justin Trudeau at the Toyota plant in Ontario. (Photo by Lars Hagberg/AFP via Getty Images).

An SUV uses 25% more energy than a medium-sized car, such as a hatchback or sedan. Growing sales of SUVs in Canada have led to emissions of 18 million more tonnes of carbon over the last decade than would have been the case with smaller passenger cars.

And the roll-out of EVs is slow in the country. In February 2020, two-thirds of carmaker dealerships in Canada did not have a single EV on sale, the report states.

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Environmental Defence pinpoints higher profit margins as the main motive for manufacturers to produce SUVs, which cost around $10,000 a vehicle compared with medium-sized cars. In 2017, this price difference helped push car industry revenues up 2.9% above the previous year despite a decline in sales of 2.1%.

The report calls on the Canadian government to introduce stringent national emissions standards requiring automakers to cut emissions from their vehicles. In Europe, such standards are credited with a tripling of EV sales between 2019 and 2020, the report states.