03/02/2023
In a recent survey, 42 per cent of Australians said they would buy an electric vehicle (EV)1 next time they buy a car. The shift in consumer sentiment towards EVs from just five years ago indicates many more people are now willing to take action to reduce their road-transport carbon emissions. We must examine the market in depth to understand if consumer willingness can be translated into action, considering consumer taste, buyers’ financial capacity and availability of EVs.
About one million new light vehicles are sold in Australia each year. In 2022, only 33,000 plug-in EVs were sold2, accounting for about 3.1 per cent of the new car market. There is still a substantial number of new fossil-fuel powered cars being sold, and many of them will still be running in 20 years, as the average age of an Australian light vehicle is a bit over 10 years. Australia will need to halt the sale of new fossil-fuel vehicles by 2030 in order to achieve net-zero road-transport emissions by 2050.
To get from 33,000 to a million EVs by 2030, there needs to be a rapid escalation of the importation of EVs or a re-introduction of car manufacturing. The lack of a mandatory vehicle fuel-emission standard in Australia means the importers of any light-vehicle brand aren’t required to sell EVs. If the Federal Government does introduce such a standard, brands will have to import more EVs to help lower the average emissions per car, and there will have to be penalties for any brand that doesn’t meet the standard. Otherwise, given the current international EV shortage, manufacturers will prioritise markets in countries with a standard to avoid the fines. Because demand is outstripping supply, the shortage may last for quite a while, as it takes time for factories to gear up for producing EVs, including for right-hand drive options for countries like Australia. And because vehicle manufacturers make more money per fossil-fuel vehicle due to the scale of manufacturing, incentives may be needed for manufacturers to adjust their business model.
My research has shown that for Australians, like car buyers in other advanced markets, the price of EVs and the availability of a comprehensive, publicly accessible charger network are the two biggest considerations for an EV purchase. Until recently, manufacturers have focused on the upper, more expensive niches of the market. Until a supply of more modestly priced models comes onto the Australian market, many buyers will continue to purchase petrol and diesel cars.
Half of Australian buyers don’t buy new vehicles, so there also needs to be sufficient availability of second-hand EVs. This in turn relies on government and business expediting their fleet transition to EVs, with the consequent vehicle turn-over every three-to-five years or so. Government departments procuring EVs in large numbers could help increase the range of EV models importers are willing to bring to this country. New Zealand, which introduced EV policies in 2016, has priority over Australia for EV models because the market there is much more developed and there is a mandatory vehicle fuel-emission standard.
To ensure there is a nationwide charger network that continues to grow as the fleet expands, with stations that are repaired promptly if they break, are accessible 24/7 and have adequate lighting, governments will need to support private networks for the foreseeable future, until the EV market is well established. This will need to include support for remote locations, so that the fear of running out of charge is allayed. And in popular locations, such as on major transport routes, there will have to be an adequate number of chargers so that queue times are acceptable.
Governments have a key role to play in ensuring Australia gets an adequate supply of EVs and that we have a functioning charger network to support growing demand. We can only hope the necessary changes are made as soon as possible to accelerate our journey towards a more sustainable future.
1In this article I use the term electric vehicle to mean plug-in vehicles rather than those termed hybrid electric vehicles, such as Toyota’s Prius, which only use fossil fuels and continue to produce emissions for every kilometre travelled for life, rather than plug-ins that reduce travel emissions in line with the electricity supply.
2Including fully battery EVs – also called BEVs e.g. Tesla, and plug-in hybrids PHEVs, which use petrol some of the time as the battery only gives a limited range e.g. Mitsubishi’s Outlander.