That $257 million Prime Minister Christopher Luxon said National would spend over the next four years to build 10,000 chargers for electric vehicles? What happens to it now that sales of EVs have collapsed?
Sales went through the roof with the taxpayer-funded Clean Car Discount (CCD). Now, three months into 2024, they’ve fallen through the floor without it. Any effect the imposition of Road User Charges on April 1 might have will be known later.
The collapse wasn’t unexpected, once the National government axed CCD on December 31. But it makes it clear everywhere that EVs – more so those that run on batteries (BEVs) alone – don’t sell in numbers without government picking up part of the price.
The handouts have been a fault line running through overall sales figures since the previous Labour/Greens/Maori administration – bewildered net-zero evangelists all – put CCD in place in June 2021.
On the campaign trail leading to last year’s election, Luxon said: “National will unleash the transition to an electric transport system by investing in EV infrastructure and cutting red tape to deliver more chargers, in more places, more quickly and more cheaply.”
Six months on, new EV sales are going nowhere fast. New Zealand is in a recession. Will Luxon’s government slash both the $257m and the number of chargers? Will it shelve its investment altogether (if it hasn’t backed away from it already)?
Boosting EV charging infrastructure from “1200 to 10,000” – Luxon’s words – would require growth of massive proportions, ultimately around 750.0% over four years. The $257 million would surely be better spent elsewhere.
Luxon announced the planned investment when sales of BEVs were riding high on rebates and heading towards a 2023 average of 1753 units a month, or 21,036 for the year.
Sales after three months of 2024:
• BEVs are in comparative freefall, averaging 361 a month, down 76.0% on the 1525 average at this time last year.
• 1083 BEVs are on the NZ Transport Agency books. This time last year, 4575 had been logged.
• BEVs have a 5.0% share of the light passenger market; last year 23.0%.
• Plug-ins with a petrol engine (PHEVs) have slumped 56,0%, to 591 from 1361 in 2023.
• Petrol-electric hybrids (HEVs) are up after the first quarter by 14.0%, to 6772 against 5949 in 2023.
• Vehicles with internal combustion engines – petrol, diesel, LPG – are down 14.0%, to 13,152 from 15,224 a year ago.
The only growth sector so far in 2024 is that of HEVs. This hasn’t been lost on Toyota NZ, which is actively promoting its HEV fleet. So is Toyota Australia. Sales of HEVs there last year were up more than 20.0% on 2022. Toyota models accounted for seven out of 10 HEVs.
In the UK, the Society of Motor Manufacturers & Traders (SMMT) reports sales of HEVs reached record levels in the 2024 first quarter, up 20.0% on last year. Sales of PHEVs were also up, although they lagged far behind HEV numbers.
BEV sales rose, but their market share fell away. The only growth area for BEVs was in the fleet sector, said SMMT. Sales of purely petrol vehicles were up almost 10.0%.
An international industry veteran who has long argued that HEVs are crucial to a lower emissions future is Carlos Tavares, the CEO of the Stellantis Group, a global operator that has Germany’s Opel, France’s Peugeot and Citroen, Italy’s Fiat and Alfa Romeo, and America’s Jeep and Ram brands under its wing.
Tavares believes the European Union’s proposed ban on fossil fuel car sales from 2035 is unnecessary. So too another EU proposal, that HEVs be phased out as low-emission vehicles from 2030.
He is on record as saying HEVs should play a more significant role in the transition to EVs. “If we really want to protect the planet, consider this: The average age of the (European and US) car park is 12 years.
“If you took all the cars that are 15 years or older and replaced them with the equivalent modern car – pick-up, sedan, what have you – the result would be a very fast 50% reduction in carbon dioxide, on average.
“These cars can be an affordable proposition, with mild hybrid technology, and sales would be very high. There would be big volume because you’ve protected affordability. If we were pragmatic, we could do that plan.”
Akio Toyoda, the chairman of Toyota, has for some time questioned the wisdom of a mad scramble to EVs.
He came under much criticism for it at one stage but reasoned that rather than telling people what they wanted, it might be a better idea to provide them with options – BEVs, PHEVs, HEVs, and hydrogen-powered cars – and let the market decide.
“Because the right answer is still unclear, we shouldn’t limit ourselves to just one option,” Toyoda told the Wall Street Journal last year.
He said something similar at the Tokyo motor show: “I have continued to say what I see as reality. There are many ways to climb the mountain that is achieving carbon neutrality.”