Australians want in on the $46 billion electric car market but the government is making it basically impossible, according to one expert

Image: iStock/acilo
  • Australia is 10-12 years behind the rest of the world’s uptake of electric vehicles, according to e-mobility expert Dr Jake Whitehead.
  • “If they were serious about climate change, they’d be serious about the uptake of electric vehicles,” he said of the government’s approach.
  • Sales figures in China are expected to reach about 3.7 million in 2021, whereas growth in Australia has been miniscule.
  • Visit Business Insider Australia’s homepage for more stories.

As demand exceeds supply in the global $46 billion electric car market for the first time, it’s still astoundingly difficult for Australians to buy one.

In 2020, electric vehicles made up 0.75% of new car sales in Australia, up from 0.6% in 2019. The growth is sluggish compared with the UK, where sales were up 10.6% – up from 3% the previous year. Sales figures in China are expected to reach about 3.7 million in 2021.

Electric cars use electricity from batteries rather than fuel, with hybrid models that are powered by a combination of both. In recent years they have become a much more attractive choice thanks to increased range, battery life, efficiency, and affordability.

However an expert in the space says that while demand for hybrid and electric cars is significant in Australia, current state and federal government legislation is making it difficult for manufacturers to see the benefits of bringing these models into the Australian market.

Why is it so hard to buy an electric car?

The problem is a double-hit on consumers, Dr Jake Whitehead, e-mobility fellow at the University of Queensland Dow Centre for Sustainable Engineering Innovation & School of Civil Engineering, told Business Insider Australia.

On the one side, Australia hasn’t created incentives for consumers in the same way governments in Asia and Europe have, he said. On the state and federal level, in some cases policy actually punishes those who choose to invest.

He said that the fact car companies, most recently Volkswagen, said they would not be bringing in electric vehicles into Australia on the basis of the current policy, is reflective of the wider state of play.

“They’re selling like hotcakes in Europe, China [and] the US, so Australia looks like a pretty risky proposition unfortunately,” he said.

“Really that can only change by having some leadership at the national level and, failing that, the states and territories doing more.”

Speaking to the Sydney Morning Herald, chief executive of the Electric Vehicle Council Behyad Jafari echoed this sentiment, saying “Australia is easily the most hostile environment for electric vehicles in the world.”

Government not doing enough

Whitehead said he works closely with consumers through his research and said that most people who say they make decisions based on reducing their climate footprint say they would like to buy a hybrid or electric car. However, he said the lack of options creating less competition is holding Australians back from buying.

With 300 models available globally, Australia currently has about 30, representing less than 10% of the available market, with policy roadblocks as the primary cause.

“We’re 10-12 years behind the rest of the world,” Whitehead said.

To catch up, the federal government needs to commit to cutting carbon emissions from the transport sector by a set amount by 2030, and develop planning guidelines from state governments to ensure all new public buildings come with charging stations, in-line with international practices.

Furthermore, Australian fuel and emissions standards don’t align with newer electric and hybrid car models, and an overflow of older models makes it difficult for new cleaner models to compete in the market without emissions regulations.

Whitehead said that international car manufacturers look at the risk of sending their product into Australia when they “know for sure they’re going to be sold before they reach the dock in Europe or the US.”

“That’s the reality: we’re competing with other markets that have certainty in terms of their policy.”

States making it easier to buy electric cars

Whitehead said some states were making it easier to buy, with the ACT offering free registration and stamp duty, and investment in infrastructure in Queensland.

However most other states are falling behind in terms of incentivising consumers and making electric cars more affordable for Australian households.

In Victoria, for example, a tax has been introduced for electric vehicle drivers, which only serves to make it harder for people who may have considered an electric car.

These laws are misguided and are missing the point, Whitehead says, because “you cannot tax a product before it has matured and existed. Otherwise you end up with no revenue.”

“It’s kind of like saying, ‘let’s tax rockets to Mars now in the hope that one day we’ll raise revenue in the future. You’ll never get your rocket to Mars because you’ve added tax onto it,” he said.

“You actually need to encourage the uptake of a product to get it to a sustainable level in order to have something to tax.”

But he says he’s encouraged that other states seem to have paused, or announced they’re not going to go forward with the same action.

Whitehead said that, ultimately, the government’s approach reflects a lack of serious investment in climate policy more generally, with the end result hurting Australian consumers.

“If they were serious about climate change, they’d be serious about the uptake of electric vehicles.”

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