‘Too much too soon’ for EV sales
Government’s new $2.9 billion Emissions Reduction Plan
Subsidies for ‘‘clean’’ transport, a cornerstone of the Government’s new $2.9 billion Emissions Reduction Plan, could increase the price of Electric Vehicles [EV’s] and deter Southlanders from making the switch, an Invercargill car sales company director says.
Yesterday morning, the Government announced $1.2b from the Climate Emergency Response Fund would go to transport as part of its new Emissions Reduction Plan.
Of those funds, more than half a billion dollars would go towards trialling a vehicle scrap and replace scheme, which aimed to help low-income households swap high polluting vehicles for lower emission alternatives, such as EVs.
A ‘‘social leasing’’ scheme would be introduced to allow lowincome earners to lease ‘‘clean’’ vehicles, whilst the Clean Car discount, or ‘‘Ute Tax’’, was flagged to extend beyond 2024.
However, Electric Motor Vehicle Company director and owner Alex de Boer believed the subsidies would not encourage Southlanders to make the switch, and could even hike up the prices of EV’s. ‘‘As soon as you introduce a subsidy, the price of the goods go up. When the last subsidy came in last year, the price of electric vehicles jumped by almost the same price as the subsidy,’’ de Boer said.
‘‘Because there is more electric cars being wanted by people due to the subsidy, dealers are buying in Japan by auction system. And if there’s more demand at auction for the cars, the price is going to go up.’’
Car companies were manufacturing for where there was the most demand in the market like Europe and America, he said, the majority of which was right-handdrive, constricting supply for lefthand-drive nations like Australia and New Zealand.
‘‘As soon as you introduce a subsidy, the price of the goods go up.’’ Alex de Boer Electric Motor Vehicle Company director and owner
He expected difficulties with supply to alleviate in the coming years as the majority of car manufacturers have stated that they will stop making petrol and diesel cars by 2035. ‘‘So all we’ve got to do is be patient.’’
Further, he believed it would take time as opposed to subsidies to sway Southlanders towards EVs, an opinion backed up by Great South’s Southland EV and Hybrid Uptake survey last year, wherein 74% of Southland businesses and 45% of households said they were not supportive of the Clean Car subsidy.
The $2.9b Emissions Reduction Plan was heavily focused on transport, with the aim of having 30% of New Zealand’s light vehicle fleet electric by 2035.
Other areas of focus included industry, with more than $650 million allocated to helping to decarbonise over four years, with a further $355m flagged to be used in following budget periods.
In the agricultural sector, $339m was allotted for a new Centre for Climate Action on Agricultural Emissions to develop and commercialise products to help farmers reduce emissions.
Environment Southland councillor Robert Guyton said it was very encouraging to see such widereaching policies put forward, and believed Southland was in an ‘‘amazing’’ position to transform its industries in line with the plan.
‘‘We have vast amounts of land, good rainfall and quite a few less people than other regions ... we’re quite innovative, Southland people . . . we’re in a good place to transform,’’ he said.
The creation of the Environment Southland Climate Change subcommittee, for example, was a promising sign for the region.
‘‘The new climate change committee is extremely important . . . these issues are being actively addressed, I am extremely proud of it.’’
However, the Emissions Reduction Plan was largely proposals and pathways forward, Guyton said, and he was mindful that some industries such as agriculture may push back against implementing proposed regulations. ‘‘We have to hope they go ahead,’’ he said.