EV goals a welcome stretch
KEY players in the motor industry have cautiously welcomed this week’s Climate Change Commission report, while also warning that its recommendations regarding the speed at which the country might move to importing fullyelectric vehicles only may be unachievable.
Amid a raft of comment by car companies, the Motor Industry Association (MIA) and motorist groups such as the Automobile Association, much has been said that is obvious and sensible.
However, relatively few remarks have focused on two important points that are covered in the report: firstly, the fact that the time frames for New Zealand moving to a fullyelectric new and used import market will, in part, be determined by what is happening elsewhere in the world; secondly, forecast future changes in the purchase price differential between EVs and conventional cars.
New Zealand is a relatively small car market, with about 300,000 cars imported annually, comprising a roughly 50:50 mix of new and used import vehicles. We are also in the minority as a righthand drive market.
In the main, the extent to which carmakers move to provision pureEV righthand drive vehicles will be determined by the timeframes those markets much larger than our own (think the UK, Japan, India and Australia) adopt for phasing out fossil fuelpowered vehicles. With the exception of our cousins across the Tasman, the thinking elsewhere is converging on the same 20302035 window proposed here.
There are subtle and important differences though, that may ultimately influence our pathway, too. The UK, for example, is targeting 2030 as its EVonly year, but allowing for some hybrids to be sold through to 2035. Japan, on the other hand, has been talking about 2035. This suggests that the supply of righthand drive pure EVs may well be a limiting factor for New Zealand.
Price convergence has been occurring for some time, and the Climate Change Commission’s analysis in this area makes sense to me. It suggests 2031 as a pivot point when new EVs become cheaper to buy than their petrol or diesel equivalents, and estimates 2026 as the year in which their cost of ownership over five years becomes less than a petrol or diesel car.
Regardless of how quickly pricing aligns and the importing of petrol or dieselreliant cars ends, there will be a substantial lagtime before that change transforms the Kiwi vehicle fleet. That fleet currently stands at more than four million vehicles, of which only a fraction are EVs.
The Climate Change Commission report explores this aspect of transformation in some detail. Based on its proposed timeline for phasing out the import of nonEVs in the early 2030s, the modelling shows that by 2035 some 36% of cars on our roads will be EVs, and 46% of all travel by cars will be in EVs. It will then take until about 2050 before petrol, diesel and hybrid cars are completely gone from our roads as daily transport.
It is worth noting as a concluding point, that when the commission references EVs, it is using the term as a shorthand for vehicles that have zerocarbon exhaust pipe emissions, including the hydrogen fuelcell vehicles that some are picking will be the ultimate future of motoring.