Govt considers scrapping old cars to modernise vehicle fleet

By RNZ

The government is considering putting a levy on imported petrol vehicles to help subsidise electric cars.

However, Official Information Act documents released to the Newsroom website show it is still investigating a voluntary car scrapping scheme.

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Associate Transport Minister Julie Anne Genter told Newsroom she is expecting advice from officials within weeks on the scheme.

She told Newsroom it is likely to be a trial at first, if the scheme does go ahead.

The average age of cars in New Zealand is just over 14 years - in Australia it's 10 years and in Europe just over seven years.

Chief executive of the Imported Motor Vehicle Industry Association David Vinsen told Morning Report it is a work in progress.

"There's all sorts of different ideas, a couple of them have been added, going way back to the previous Labour government."

In 2007 and 2009, the Ministry of Transport ran two scrappage trials.

But Vinsen said far too few people took them up.

"The idea was if you've got a vehicle that is no longer fit for purpose, either damaged or uneconomic to continue to run it, you get paid some sort of subsidy or incentive to take it off the road," he said.

"Typically those cash incentives have only worked in those countries that have new vehicle manufacturing capability and in effect it's been a subsidy to the new vehicle manufacturers, particularly during times of financial crisis, so it's just a stimulation for the local economy," he said.

"We worked out if we stopped all used vehicles from coming into the country for three or four years, and even if we doubled or tripled the number of new vehicles sold, it would still take years to make any material difference to the fleet."

In New Zealand the key will be to get people out of private transport and into other forms of transport, he said.

"It would mean some of those old $1000, $2000 cars would disappear from the fleet."

People on lower incomes may be able to get rid of their older costly cars and instead use car-shares and public transport.

He said New Zealand's fleet is getting older as vehicles are lasting longer and are seen more as a commodity than an asset.

Each year we scrap about a quarter of a million vehicles with an average age of 18 years, he said.

But, he said, social changes are starting to see a shift away from private ownership of cars.

- RNZ