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Will higher gas prices put a damper on Canada's love affair with trucks and SUVs?

May 2, 2022, 11:00 a.m. (EDT)
People kissing SUV.

There was a time, not so long ago, when most Canadians drove a car. Back in 2009, for example, approximately half of the new motor vehicles sold in Canada were passenger cars.

By 2021, just over three-quarters (76.2%) of the new motor vehicles sold in Canada were light trucks, a group which includes pickup trucks, SUVs and crossovers.

While trucks have accounted for an increasing share of new motor vehicle sales for a decade, for the first time since 2013, annual passenger car sales increased, with the number of units sold rising 6.1% to 345,350 in 2021. Meanwhile, total sales in dollars were up 18.1% to $13.6 billion.

Sales of light trucks increased at a slower pace than passenger cars, rising 4.9% to 1.3 million units sold, while sales were up 9.6% in dollar terms to $60.8 billion, on higher prices.

In 2021, new registrations for all fuel type vehicles were up year over year. Hybrid electric (+91.4%) vehicles registered the largest gain from 2020. Registrations of battery electric vehicles rose by half, while plug-in hybrid electric registrations were up by three-quarters. Registrations of gasoline-powered (+2.2%) and diesel-powered (+1.7%) vehicles rose at a much slower pace.

One reason for the increasing popularity of passenger cars and electric- and battery-powered vehicles may be rising gas prices.

Gas prices were up 31.2% on an annual average basis in 2021 and were 12.8% higher than they were in 2019, before the COVID-19 pandemic.

A litre of fuel in a gasoline- or diesel-powered passenger car goes a lot further than it would in a truck. Of course, rising gas prices are not an issue at all for new electric car buyers, although prices for electricity are also rising on an annual average basis (+2.4%), albeit at a slower pace than gasoline.

Adding to the cost of owning and operating a car are higher sticker prices. Annual average prices for passenger vehicles were up 5.1% in 2021, largely due to a global shortage of semi-conductor chips.

The one area where all car owners did catch a break was in car insurance premiums, which were down 3.4% on an annual average basis in 2021.

To keep tabs on Canada’s new motor vehicle sales by unit and type, check out our monthly or annual new motor vehicle sales release.

You can learn more about gas prices from our monthly Consumer Price Index (CPI) or annual average CPI.

Gasoline pump and two gasoline cans. Text reads: “Gas prices were up 31.2% on an annual average basis in 2021.”

Contact information

For more information, contact the Statistical Information Service (toll-free 1-800-263-1136514-283-8300infostats@statcan.gc.ca) or Media Relations (statcan.mediahotline-ligneinfomedias.statcan@statcan.gc.ca).