Canada Electric Vehicle Components Market Report, Size, Share, Opportunities, and Trends Segmented By Component Type, Vehicle Type, Technology, and End-User – Forecasts from 2025 to 2030

Description

Canada Electric Vehicle Components Market Size:

The Canada Electric Vehicle Components Market is expected to witness robust growth over the forecast period.

Canada Electric Vehicle Components Market Key Highlights

• Federal government mandates, including the Electric Vehicle Availability Standard, compel automakers to increase the Zero-Emission Vehicle (ZEV) share of new light-duty vehicle sales to 100% by 2035, directly creating non-discretionary, long-term demand for all core EV components.
• The market witnessed substantial ZEV adoption growth in 2023, with new ZEV registrations climbing 49% from 2022, accounting for 11% of all new motor vehicles registered nationally.
• More than $31 billion in automotive and battery manufacturing investments have been announced in Canada over the last four years, localizing the supply chain for components like battery cells, cathode active materials (CAM), and separators.
• Battery Electric Vehicles (BEVs) are dominating the ZEV mix, representing 76% of new ZEV registrations in 2023, which shifts demand toward high-energy-density component specifications, particularly in the Battery Pack and Power Electronics segments.

The Canadian Electric Vehicle (EV) components market is experiencing a structural realignment driven by stringent federal and provincial climate policy and massive foreign direct investment. This transition is actively converting a traditional automotive manufacturing base, historically focused on internal combustion engine (ICE) components, into an integrated EV supply chain. The resulting component demand is no longer contingent merely on consumer preference but is now an imperative tied to regulatory compliance and the localization strategy of global Original Equipment Manufacturers (OEMs). The foundational shift is creating a robust, vertically integrated ecosystem that begins with the extraction of critical minerals and extends through to final vehicle assembly, fundamentally reshaping the procurement landscape for all related parts.

Canada Electric Vehicle Components Market Analysis

• Growth Drivers

Federal ZEV Sales Mandates act as the single most powerful catalyst, directly propelling demand for all EV components. The Electric Vehicle Availability Standard, published in December 2023, establishes rising sales targets, starting at 20% in 2026 and culminating in 100% of new light-duty vehicle sales being ZEVs by 2035. This regulatory certainty forces domestic and international OEMs to secure verifiable, long-term supplies of components—such as electric motors, inverters, and thermal management systems—to meet their production compliance requirements. The corresponding surge in ZEV registrations, which reached 11% of all new motor vehicles in 2023, translates immediately into higher volume demand for component manufacturing capacity.

The Incentives for Zero-Emission Vehicles (iZEV) Program, alongside complementary provincial rebates (e.g., in British Columbia and Quebec), directly stimulates consumer-side demand by lowering the effective purchase price of ZEVs. Increased ZEV sales, in turn, drive up the order volume for every integrated component from the OEM's first-tier suppliers. Furthermore, this policy environment accelerates the adoption of advanced componentry, as consumers demand longer-range and higher-performance EVs, favoring technologies like Permanent Magnet Synchronous Motors (PMSMs) over less efficient alternatives.

• Challenges and Opportunities

The primary challenge is the midstream processing gap in the domestic battery supply chain. While Canada possesses significant deposits of critical minerals—lithium, nickel, and cobalt—and has secured major investments in battery cell and cathode active material (CAM) manufacturing, the time-intensive process of opening new mines and developing processing facilities creates a lag. This gap exposes the Canadian market to geopolitical supply chain risks and forces temporary reliance on imported intermediate materials, limiting the market's full vertical integration potential. This constrains localized component production and maintains price volatility.

The key opportunity lies in Canada’s abundance of clean, hydroelectric power. Energy-intensive component manufacturing processes, particularly in battery cell and CAM production, can leverage this low-carbon electricity mix. The resulting components can be marketed as having a significantly lower embedded carbon footprint compared to those produced in regions reliant on fossil fuels. This differentiation creates a premium market opportunity, driving the need for Canadian-sourced components from global OEMs committed to Environmental, Social, and Governance (ESG) mandates and seeking compliance with regulations like the US Inflation Reduction Act's sourcing requirements.

• Raw Material and Pricing Analysis

The EV components market, particularly the battery segment (the largest cost driver), is directly exposed to volatility in critical mineral markets. The Canadian Critical Minerals Strategy highlights domestic endowments of key battery materials: lithium, nickel, cobalt, and graphite. While Canada has strong mining potential, global price dynamics for these commodities dictate the final pricing of the Battery Pack component. Cathodes, which account for approximately 55% of a battery's cost, are especially price-sensitive to nickel and cobalt fluctuations. The massive investment announcements for new CAM facilities by companies like Umicore and Ford/EcoProBM/SK On aim to stabilize the raw material supply and reduce transportation costs, thereby mitigating component pricing risk for OEMs over the long term.

• Supply Chain Analysis

The Canadian EV component supply chain is in a critical phase of localization and de-risking. Historically dependent on global hubs in Asia for battery cells and power electronics, the supply chain is re-orienting toward a North American ecosystem. Key production hubs are rapidly emerging in Ontario and Quebec, anchored by multi-billion-dollar gigafactories from companies like Volkswagen PowerCo (St. Thomas, ON) and the Stellantis-LG Energy Solution joint venture (Windsor, ON). The logistical complexity involves managing a high-volume, just-in-time delivery system for physically large and hazardous components (e.g., battery packs) across long distances. The dependence on a few global specialized suppliers for advanced semiconductors and power electronics components (e.g., silicon carbide inverters) remains a significant dependency outside the immediate domestic control.

Government Regulations

In-Depth Segment Analysis

• By Component Type: Electric Motor

The electric motors and associated powertrain components segment is experiencing an acute shift driven by performance and efficiency mandates. The growing dominance of Battery Electric Vehicles (BEVs), which constituted 76% of new ZEV registrations in 2023, drives a specific, high-specification need for Permanent Magnet Synchronous Motors (PMSMs). OEMs favour PMSMs due to their superior torque density and higher energy efficiency, which directly translates into the longer driving ranges Canadians demand, particularly in cold weather. This trend creates a specialized requirement pull for components like high-performance stator and rotor assemblies, thermal management jackets, and rare-earth magnets. The push for local EV manufacturing, evidenced by new assembly plants, necessitates local sourcing of these sophisticated motor systems to streamline logistics and meet North American content requirements.

• By End-User: OEMs

The OEM segment represents the overwhelming majority of component demand, acting as the critical control point for the market. This growth is intrinsically non-elastic due to the federal Electric Vehicle Availability Standard. OEMs must purchase components to manufacture compliant ZEV volumes, irrespective of short-term market fluctuations. Furthermore, the massive, multi-billion-dollar domestic investments by global OEMs (e.g., Honda, Volkswagen, Stellantis-LGES) are tied to securing local, high-volume production of core components like battery cells and CAM. This strategic localization by OEMs is creating immediate, sustained demand for a network of secondary component suppliers who can integrate into these new Canadian gigafactories, seeking proximity to reduce logistical cost and supply risk.

Competitive Environment and Analysis

The competitive landscape is defined by large multinational automotive suppliers and new entrants focused on the battery value chain, all vying for long-term supply contracts with domestic OEMs. Competition is currently intensifying around localization and technological superiority, specifically in high-voltage components.

Volkswagen PowerCo SE: This company, a subsidiary of Volkswagen Group, represents a market-defining new entrant with its announced gigafactory in St. Thomas, Ontario. The strategic positioning is to establish a fully integrated, continental battery production base. Its key product/service is high-performance Unified Cells for the Volkswagen Group's global EV platform. The verifiable detail is the announced investment for its first overseas EV battery manufacturing plant, positioning it as a primary driver of localized demand for battery component raw materials and module assembly capacity within Canada.

Umicore Rechargeable Battery Materials Canada Inc.: Umicore is strategically positioned at the critical cathode active material (CAM) and precursor CAM (pCAM) stage, a high-value link in the supply chain. It's announced investment in a new facility in Loyalist Township, Ontario, focuses on producing these essential components for EV batteries. This move directly addresses the midstream supply chain gap, aiming to de-risk battery production for North American OEMs and creating significant demand for locally sourced nickel and cobalt inputs.

Recent Market Developments

• May 2024: Asahi Kasei Corporation Investment: Asahi Kasei announced a plan to build an EV battery separator plant in Port Colborne, Ontario. The investment, focused on its Hipore™ wet-process lithium-ion separator, directly addresses a critical, specialized component gap in the North American supply chain, with construction expected to be completed by the end of 2024.
• April 2024: Honda to Build Comprehensive EV Supply Chain: Honda announced an investment to establish an innovative electric vehicle assembly plant and a new stand-alone battery manufacturing plant in Alliston, Ontario. This project includes a CAM/pCAM processing plant and a separator plant, marking a full vertical integration strategy within Canada.

Canada Electric Vehicle Components Market Segmentation:

• BY COMPONENT TYPE
  • Battery Pack
  • Electric Motor
  • Power Electronics
  • Inverter
  • Converter (DC-DC)
  • On-Board Charger
  • Thermal Management System
  • Body & Chassis
  • Other Components
• BY VEHICLE TYPE
  • Passenger Cars
  • Commercial Vehicles
  • Two-Wheelers & Three-Wheelers
• BY TECHNOLOGY
  • Battery Electric Vehicle (BEV)
  • Plug-in Hybrid Electric Vehicle (PHEV)
  • Hybrid Electric Vehicle (HEV)
  • Fuel Cell Electric Vehicle (FCEV)
• BY END-USER
  • OEMS
  • Aftermarket

Table Of Contents

1. EXECUTIVE SUMMARY 

2. MARKET SNAPSHOT

2.1. Market Overview

2.2. Market Definition

2.3. Scope of the Study

2.4. Market Segmentation

3. BUSINESS LANDSCAPE 

3.1. Market Drivers

3.2. Market Restraints

3.3. Market Opportunities 

3.4. Porter’s Five Forces Analysis

3.5. Industry Value Chain Analysis

3.6. Policies and Regulations 

3.7. Strategic Recommendations 

4. TECHNOLOGICAL OUTLOOK 

5. CANADA ELECTRIC VEHICLE COMPONENTS MARKET BY COMPONENT TYPE  

5.1. Introduction

5.2. Battery Pack

5.3. Electric Motor

5.4. Power Electronics

5.5. Inverter

5.6. Converter (DC-DC)

5.7. On-Board Charger

5.8. Thermal Management System

5.9. Body & Chassis

5.10. Other Components

6.  CANADA ELECTRIC VEHICLE COMPONENTS MARKET BY VEHICLE TYPE  

6.1. Introduction

6.2. Passenger Cars

6.3. Commercial Vehicles

6.4. Two-Wheelers & Three-Wheelers

7.  CANADA ELECTRIC VEHICLE COMPONENTS MARKET BY TECHNOLOGY  

7.1. Introduction

7.2. Battery Electric Vehicle (BEV)

7.3. Plug-in Hybrid Electric Vehicle (PHEV)

7.4. Hybrid Electric Vehicle (HEV)

7.5. Fuel Cell Electric Vehicle (FCEV)

8. CANADA ELECTRIC VEHICLE COMPONENTS MARKET BY END-USER   

8.1. Introduction

8.2. OEMS

8.3. Aftermarket

9. COMPETITIVE ENVIRONMENT AND ANALYSIS

9.1. Major Players and Strategy Analysis

9.2. Market Share Analysis

9.3. Mergers, Acquisitions, Agreements, and Collaborations

9.4. Competitive Dashboard

10. COMPANY PROFILES

10.1. Magna International Inc. 

10.2. DANA TM4 INC

10.3. Aisin Seiki Co., Ltd

10.4. Linamer 

10.5. Panasonic Corporation

10.6. Denso Corporation

10.7. Electrovaya Inc.

10.8. Martinrea International Inc.

10.9. Eaton 

10.10. Siemens 

11. APPENDIX

11.1. Currency 

11.2. Assumptions

11.3. Base and Forecast Years Timeline

11.4. Key benefits for the stakeholders

11.5. Research Methodology 

11.6. Abbreviations 

Companies Profiled

Magna International Inc. 

DANA TM4 INC

Aisin Seiki Co., Ltd

Linamer 

Panasonic Corporation

Denso Corporation

Electrovaya Inc.

Martinrea International Inc.

Eaton 

Siemens 

Related Reports