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The Federal Government wants half of all new cars sold in Australia to be electric by the middle of next decade, but there’s one large problem with that - half of Australians don’t want an electric car.
A recent poll published in The Sydney Morning Herald said just one in 10 voters was interested in buying an electric car in the next two years. That tracks with the current sales of electric vehicles (EVs), which have been hovering around the 10 per cent mark for the last two years.
That leaves a big gap between the current reality and the government’s aspirations, and leaves car companies in a difficult position. Do they continue to offer more EVs in the hope Australians will gradually change their mind? Or do they focus on selling the cars that they know customers want - hybrids and internal combustion engine models?
According to the poll published by the newspaper, there are several reasons why buyers are reluctant to purchase an EV. Nearly half the people polled cited price as the primary factor in their decision to avoid an electric car, while 40 per cent said lack of charging infrastructure and nearly the same amount (37 per cent) said charging times and 36 per cent said a lack of range.
These are all things the car industry is looking to improve, especially bringing costs down while extending range and speeding up charging. But industry experts concede there is still more to be done.
Mazda recently confirmed it will introduce the 6e sedan in 2026, which will be only its second EV in the local market. The company promises more than 500km of driving range and a starting price below $55,000, but Mazda Australia Managing Director, Vinesh Bhindi, told CarsGuide he is still anticipating the government will offer incentives to support EV sales.
“Well, I'm expecting, but I'm sure there'll be many more conversations from the lobbying group,” Bhindi said, referencing the Federal Chamber of Automotive Industries (FCAI).
“Because it doesn't just happen, you have to have inputs to make this significant change.”
Bhindi admitted that car companies are still dealing with the implications of the New Vehicle Efficiency Standard (NVES), which puts a limit on CO2 emissions and fines car makers for breaching those limits. This has led to price rises already across several brands, as well as multiple older models scrapped altogether in order to lower emissions for particular brands.
Bhindi said car makers are currently facing two alternatives to comply with NVES, and neither are good for consumers.
“ So the way I look at it, there's two paths to comply with NVES,” he said. “ One path is you get to those numbers and the only way you're gonna do that is restrict choice for consumers. The second path is to pay the fine.
“Both paths, you're compliant, right? But that's not the game. The game is to reduce CO2. And restricting choice for a consumer is not good for anybody. So our path is to give customers the choice and make the customer choose which path they want to go.
“And if that means it's not 50 per cent, it's 20 per cent, and the byproduct of that is there's a cost to a business. And if it's on an ongoing basis and it's significant, then it comes into pricing. And everybody's complying or the government will go down a different path.”
That ‘different path’ would be incentivising EVs, or at least lower emissions vehicles, in order to reach the government’s target of 50 per cent. What those incentives are remains wide open, according to Bhindi with multiple “levers” the government could pull.
“So what I'm expecting and probably thinking is that the government at some point, if they're serious about this, they will have to pull certain levers,” he said.
“And levers could be, provide the infrastructure, provide the guarantee of energy supply, but at a reasonable price. But also maybe look at tax incentives or, they've done FBT [fringe benefit tax] and it drove a lot of business with plug-in hybrid, but as soon as it's pulled off, it stopped.
But for BEV [battery electric vehicles], it's still there. So there are a lot of levers the government could consider and their will in their time. That's not our part.”
