FCAI shares concerns over Greens federal EV policy

THE Federal Chamber of Automotive Industries (FCAI) has shared its concerns over the federal electric-vehicle policy proposed by the Australian Greens yesterday, describing it as “quite dramatic”.

Speaking to GoAuto, FCAI chief executive officer Tony Weber stressed that EVs still face several roadblocks before widespread adoption becomes the norm.

“As an industry, we support the movement to zero-emission vehicles as part of the powertrain mix,” he said.

“Clearly zero-emission vehicles are part of future transport, but we do have a few concerns around what’s been released.

“The rate of introduction is quite dramatic given that by 2022 they’re talking about 10 per cent of the market – that’d take 120,000 zero-emission vehicles.

“To get to 10 per cent you’d need people to prepare to purchase these vehicles.”

Under the Greens’ plan, major manufacturers would need to set increasing annual sales targets for EV passenger cars, rising from a two per cent share by 2020 to five per cent by 2021 and 10 per cent by 2022.

For reference, of the 1,189,116 new vehicles sold in Australia last year, only 1124 were EVs, equating to a market share of less than 0.01 per cent.

“People have three fundamental concerns if we talk about electric vehicles,” Mr Weber added.

“One is range restrictions, and that’s more of an issue when you want to tow as that reduces your range capacity quite substantially.

“(And) not only are these (EV) technologies not currently available in Australia, by 2022 – we are talking about less than one model cycle for most vehicles – the price differential is substantial.

“Most people buy vehicles under $30,000, and you are paying a substantial premium on those (to purchase an EV).

“(Then) there is the infrastructure to refuel these vehicles. Not everyone has, domestically, the circumstances to charge – a number of cars are parked in the street every night, so there’s no garage.

“Many older units, blocks do not have electricity for every vehicle in their garage. There are many households, even if they do have a garage, that don’t have enough garages for all the vehicles.”

When questioned if the Greens’ suggested $151 million fund for a larger EV charging network would help ease this concern, Mr Weber said: “3000 (stations) doesn’t sound like very many to me.

“I would be concerned if I was travelling on the highway and wanting to refuel on electricity if there was a queue in front of me, especially in the holiday period.

“Issues around range anxiety are unlikely to be addressed by 2022, or even 2020 when this starts.”

Mr Weber also took exception to the Green’s proposed tax breaks for EVs, which would see the import tariff, Goods and Services Tax (GST), stamp duty and three years of registration fees waived for such vehicles, helping to reduce their driveaway prices by up to 20 per cent.

“The import tariff only applies to 25 per cent of vehicles brought into the country at the moment,” he said.

“GST has to be approved by the states and territories, so you have to have agreements.

“Stamp and registration duty is an issue for states and territories, so the Greens stitched that up, and registration fees likewise.

“The only one that the Commonwealth has its hands completely on the lever for is the tariffs.”

The Greens also suggested that wholly petrol and diesel luxury passenger cars which cost more than $65,000 be subject to a four-year 17 per cent tax in addition to the current 33 per cent Luxury Car Tax (LCT).

This short-term measure would compensate the federal and state governments for revenue that would otherwise be generated by the aforementioned taxes, but Mr Weber cautioned that this move could have a detrimental effect.

“Many vehicles that come into this country that are more expensive and pay the Luxury Car Tax have technologies in them that improve safety and emissions outcomes,” he said.

“If we focus on emissions outcomes, these technologies have to come into the market to get acceptance and purchased, because it’s not just about introducing a vehicle in the market, they have to be accepted in the marketplace – people have to buy them.

“You can line up as many electric vehicles as you want in a dealership, if no one ever buys one, it is not going to change the outcome for the environment one iota.

“These (luxury) cars, the technology that trickles through becomes cheaper because it gets volume.

“If you put the Luxury Car Tax up so that people do not buy the leading technologies that are introduced around the world, Australians do not buy that technology, it will not trickle down throughout the car park.

“What this will do is actually deliver worse outcomes to the environment than better, because people may hold onto their car for a long time.”

Additionally, the Greens called for fossil-fuelled passenger cars – including hybridised versions – to be banned from sale by 2030, matching similar goals recently set by India and the Netherlands.

Mr Weber noted that the Greens’ claim that the United Kingdom will phase out internal-combustion engines by 2040 is incorrect as hybrid vehicles will still be available there after this time.

When questioned what a reasonable timeline for the ban of petrol and diesel passenger cars would be, he said: “I don’t know how quickly the technology of zero-emission vehicles will come to market.

“If you go back to (five-year) model cycles, 2030 is not that far away.”