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When politicians make important financial decisions based on a movie they may have seen as children, it should come as no surprise if the results turn out to be less than optimal.

Field of Dreams was a successful 1989 film based on a 1982 novel about a 1919 baseball scandal. An Iowa The farmer, played by Kevin Costner, keeps hearing an ethereal voice advising him: “If you build it, he will come.” So he builds a ball diamond in a cornfield. field, and indeed, long-dead figures from a long-defunct baseball team – including Ray Liotta as his father – stroll out of the field to play a game with others.

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As far as I can tell, the justification for sending tens of billions of dollars to auto giants to help them build battery factories for electric vehicles rests on the same principle: No matter how uncertain the prospects for electric vehicles may be, governments in Ottawa, Ontario and Quebec insist that success is inevitable. If we build the factories, the buyers will come.

That’s not how it has worked so far. The original dream of sleek, zero-emission vehicles gliding silently through the countryside has been met with a growing public awareness: There are potholes. Batteries are very heavy and far from cheap. Then there’s the whole issue of range uncertainty, the relative scarcity of charging stations and the unreliability of existing ones, not to mention the fact that much of the world lacks the will, capacity, money or intention to build the massive infrastructure needed to power the electric mobility revolution. Sure, 93 percent of new cars sold in Norway (population 5.6 million) are electric; in India (population 1.5 billion), the figure is two percent. Norway has an oil-backed sovereign wealth fund of $1.7 trillion. India has an average annual income of $1,314.

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The result is that sales of electric vehicles are falling and car companies are rethinking their strategies. Volkswagen had planned six new battery factories but now says the schedule could be delayed. “There is currently no business justification for the decision on additional sites,” CEO Oliver Blume told Czech officials who would like to be among the candidates. A decision, Blume said, would be made “on the basis of market conditions, including the sluggish start of the (electric) market in Europe.”

Ford Motors is also curbing its enthusiasm for the all-electric vehicle future, postponing a $1.8 billion plan to convert its Oakville, Ontario, plant into a state-of-the-art electric vehicle production centre to be renamed the Oakville Electric Vehicle Complex. Instead, the plant will be retooled to produce the F-Series Super Duty pickup, a traditional gas-guzzling exhaust machine.

The government’s thinking behind the electric car policy was straight out of Field of Dreams, but with a twist: Automakers would be forced to build these vehicles while drivers would be bribed to buy them. The regulations unveiled by the Canadian Liberals in 2023 were typical of this type: Sales of new gasoline-powered vehicles would be effectively blocked until 2035, while automakers would be required to demonstrate regular increases in the availability of electric vehicles, whether demand justified it or not.

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Try as they might, politicians have limited ability to impose their views on a skeptical population. The crusade against electric vehicles is a case in point. While sales of fully electric vehicles are sluggish, hybrids are selling fast. Former Toyota CEO Akio Toyoda predicted this when he argued that the rush to jettison a century of engine technology in favor of a replacement still under development was going too far, as much of the world simply wasn’t ready. Toyota produced the first mass-market hybrid car more than 25 years ago, but Toyoda’s view was deemed so inappropriate that he was forced to step down in 2023 in favor of a less skeptical, more contemporary successor.

But as it turns out, he was right. While electric vehicle sales are declining, demand for hybrids is high. Because hybrids have both a gasoline engine and a small electric motor, they don’t have the same concerns about range or charging stations. They’re cheaper, get better mileage and reduce emissions. Hybrid vehicle sales in the U.S. rose 53 percent year over year in 2023 and another 50 percent in the first few months of this year. The Wall Street Journal reported that hybrids were selling nearly three times faster than electric vehicles and twice as fast as traditional internal combustion engine versions. At its announcement in Oakville, Ford expressed hope that the redesign “paves the way to bring multi-energy technology to the next generation of Super Duty trucks.” But they were talking about hybrids, not electric vehicles.

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Don’t expect this to impress politicians. The governments in Ontario, Ottawa and Quebec have poured so many billions and so much talk into their battery blueprints that they are not prepared to change their minds just because the market does. Already, fields big enough for numerous baseball stadiums are being cleared for battery factories, walls are being put up and staff are being hired.

At least as important is the amount of political capital at stake, because none of the three men behind the big subsidy cheques – Prime Minister Justin Trudeau and Premiers Doug Ford and François Legault – are so popular that they can afford to lose much more of it. Ford and Trudeau recently visited a Goodyear plant in Ontario to announce an expansion backed by $64 million in subsidies. Electric vehicles are good for tire sales because their extra weight causes the tires to wear out faster than usual. The plant will produce specially designed electric vehicle tires, no doubt with specially designed prices to match.

Unless electric car prices drop and range and charging options change, buyers will likely continue to prefer hybrids to pure electrics. Paradoxically, Western governments are doing their best to keep it that way. Trudeau announced Monday that Canada would join the U.S. in imposing 100 percent tariffs on imports of cheaper Chinese vehicles, ensuring buyers are locked out of competitive pricing and the gap between electric and hybrid cars remains.

One way or another, Canada will have a battery industry. The treasury is open to government handouts. If only they could persuade Kevin Costner to help boost sales.

National Post

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