IT’S NOT rocket science: A business can’t sell its product without customer demand, nor will it move very much off the shelves if the price for that product isn’t in the sweet spot.
The British inventor James Dyson, who arguably developed one of the best living-room vacuum cleaners on the planet, found that out when he first showcased a prototype of his remarkable machine in U.K. shopping malls.
Homemakers who gave Dyson’s vacuum a whirl admitted it was very good indeed. But, when informed how much its creator was asking for his product, they were frank: they would never pay that much for a vacuum cleaner, no matter how good it was.
So Dyson, who learned determination from long-distance running, went back to the drawing board to find a way to lower the price and still deliver a product that would provide dazzling performance. Eventually, he found the sweet spot, and his vacuum made him a very wealthy man.
Vacuums are not like automobiles. You can get by without one, or at least the very best one. But many people find they can’t get by without a car or truck — the demand for personal vehicles remains very strong.
But unlike the situation, say, 50 years ago, most vehicle owners grudgingly admit that their need for a car or truck is helping to warm the planet to an alarming degree. That’s because the large majority of vehicles still run on gasoline or diesel.
It’s no surprise, then, that many Canadians are considering an electric vehicle (EV), despite the price tag, which remains hefty compared to those powered by carbon-based fuel. Veteran auto journalists are raving about EVs on Youtube, praising their handling, get-up-and-go and range; some EVs, like the Chevy Bolt, can travel up to 300 kilometres on a single battery charge. Meanwhile, charging stations have been popping up even in remote parts of Northwestern Ontario, mostly recently in Marathon.
Electric cars are expensive, though, there is no doubt about that. A compact EV can set you back as much as a small pickup truck that runs on gasoline. The sweet spot that Dyson managed to find with his vacuum remains elusive for EVs.
Meanwhile, the Canadian Press reported last week that a federal rebate program that shaves $5,000 off the price of an EV is already halfway through its three-year budget after only eight months. That’s the demand part of the equation.
You’re laughing if you live in British Columbia or Quebec, which respectively offer EV rebates of $3,000 and $8,000. That’s on top of the federal grant.
Ontario had a similar generous rebate program, offering up to $14,000 until the summer of 2018. It was promptly scrapped by the new Doug Ford Conservative government. A private foundation has stepped in the breach, offering $1,000 to Ontario EV purchasers.
Ford, who once wanted to equip a gas-guzzling SUV with a fridge and big-screen TV, is behind the times. Canadian sales of the Bolt shot up by more than 55 per cent last year compared to 2018. Not surprisingly, most of the sales were in Quebec, not Ontario.
General Motors, the company that manufactures the Bolt, is poised to spend $2.2 billion to re-tool its plant in Detroit to produce EV vehicles. According to the Association Press, the plan includes a pickup truck that runs solely on a battery. Too bad they couldn’t do that in Oshawa, a Toronto-area city GM has pretty-much abandoned on Ford’s watch.
To be sure, EV rebates are funded by taxpayers. But we can think of less important things that governments spend our money on — legal fees for fighting a losing battle on carbon taxes, for instance.
Rebates seem like short-term pain for long-term gain. If the upward trend in EV sales continues, everyone, whether they own a vehicle or not, will benefit from cleaner air. Now that’s pretty sweet.