Nationa it will scrap the Clean Car Discount on EVs and hybrids and the so-called ute tax within its first 100 days if elected.
Sales of new electric cars hit a record in September - at least in terms of share of the market - ahead of the likely election of a National-led Government.
On the flipside, sales of higher-emission vehicles stalled.
If elected, National has pledged to scrap the Clean Car Discount andthe associated “ute tax” on high-emission vehicles within its first 100 days.
The party says it will support long-term EV adoption by expanding subsidies for public chargers to support a network of 10,000 public chargers by 2030.
Of 8150 new passenger vehicles registered during September, 2029 - or 24.9 per cent of the market - were pure electric models.
That was more than double the number of pure electric vehicles sold in August, if below the 2643 sold in June - a frenzied month before the Clean Car Discount was reduced on July 1 (from a ceiling of $8625 to $7015 for new vehicles) and “ute tax” fees increased (from $5175 to $6900 for new vehicles).
Tesla’s Model Y (697 sales) was the top-selling light passenger vehicle in the market overall, ahead of the Toyota RAV4 (683) and Toyota Yaris Cross (316).
Overall, pure electric, plug-in hybrid and hybrid vehicles hit a record 65 per cent of new vehicle registrations.
Pure electric, plug-in hybrid and hybrid vehicles hit a record 65 per cent of new vehicle registrations. Photo / Getty Images
It was a larger share of a smaller pie, however.
June saw a record 23,560 new vehicle sales as EV and ute buyers raced to get in ahead of the smaller carrot and bigger stick arriving July 1.
July and August, when sales more than halved, were “the crash after the sugar high,” Motor Industry Association CEO Aimee Wiley told the Herald.
September sales were also soft, with the EV boom balanced by some ute buyers keeping their wallets in their pockets.
Sales of the market-leading Ford Ranger, for example, fell from 842 in August to 605, as some ute buyers chose to keep their hands in their pockets until after the election.
“I expected a bigger slump in demand for fee-incurring vehicles,” Wiley said.
“For those wanting or needing to purchase vehicles that incur a fee, it makes sense to delay until fees are removed.”
“If National is elected to govern in a couple of weeks’ time, I expect consumer demand to spike. People will want to get in and get a rebate before it is gone,” Wiley said “I expect consumer demand to kick in almost immediately post-election and lift October results, followed by a very strong November result.”
EY NZ director Ashley Kearton saw the same trends over the next two months.
Double-whammy ahead
An EY survey of 500 New Zealanders’ buying intentions recently found that 42 per cent wanted to buy a pure electric, plug-in hybrid or hybrid car - a fall after the same number nearly doubled to 49 per cent last year.
Kearton said the possible abolition of the Clean Car Discount was one factor.
Another was that EVs will lose their Road User Charges (RUC) exemption after March 31 next year - a move the AA says will cost the average driver $913 per year, assuming they drive around 12,000km.
There were also new concerns about EV batteries - how long they would maintain their efficiency, how easy they would be to recycle and how much they would cost to replace.
Both Labour and National - mindful that some $2 billion in petrol tax has to be replaced as New Zealand’s fleet electrifies - say it’s time for EV owners to pay RUCs as they reach around 3 per cent market share.
Rob Birnie, a spokesman for the Better NZ Trust, said his pro-EV group supported electric cars losing their RUC exemption.
But he said that with the rates currently on the table - $76 per 1000km for vehicles under 3500kg and $82 for those 3500kg to 6000kg - were an unfair balance, given the heavy crowd would be paying only a fraction more. “A Nissan Leaf causes a lot less damage to a road than a heavy vehicle.”
Trust makes case to keep Clean Car Rebate
The Better NZ Trust is also lobbying for rebates to stay.
“The Clean Car Discount is one of the most effective climate policies we have. Since it was introduced, the average emissions of new light passenger vehicles has plummeted 37 per cent from 176g/km to just 111g/km,” Birnie said.
“The Clean Car Discount is popular, it’s working, and it’s reducing emissions along with the amount New Zealand has to spend on imported oil. There’s no good reason to scrap the Clean Car Discount.”
Although it has undoubtedly influenced the market, with more than 150,000 people claiming a rebate on a new or used pure electric, plug-in hybrid or hybrid vehicle, it has not been self-funding as hoped, with “ute-tax” penalties falling short of generating enough revenue to fund the discount as more than $500 million was paid out - necessitating a $100m “top-up” in Budget 2023 to help fill the gap.
It has also faced a degree of criticism from the left. Birnie said he was aware of comments on the Great Auckland blog (which has supported the scheme overall) that the Clean Car Discount subsidised wealthy people’s purchase of EVs, and that it incentivised car purchases - seen as undermining public transport.
Birnie countered that the discount was capped at models costing up to $80,000 - and that “while the public transport focus is valid, you can’t just go cold turkey on cars. That would go down like a cup of cold sick”.
National’s transport spokesman Simeon Brown said his party won’t extend the RUC exemption beyond light EVs past March 31 next year.
“There is another exemption in place for zero-emission heavy vehicles until the end of 2025 and we aren’t intending to bring that forward,” Brown added.
Chris Keall is an Auckland-based member of the Herald’s business team. He joined the Herald in 2018 and is the technology editor and a senior business writer.
