The federal government has released a proposed New Vehicle Efficiency Standard (NVES) which has drawn mixed reaction from Australian automotive industry representatives.
Public submissions on the proposed standard close at 11.59pm on March 4, 2024.
And while most welcome the move, some like the Federal Chamber of Automotive Industries (FCAI) and the Australian Automotive Dealer Association (AADA) also want time to digest it, saying the matter is complicated.
Referring specifically to the three options delivered by the federal government, FCAI chief executive Tony Weber says the automotive industry has been seeking a fuel efficiency standard for many years but that the industry will take time to study the potential impacts.
“On the surface, the targets seeking a 60% improvement in emissions are very ambitious, and it will be a challenge to see if they are achievable taking into account the total cost of ownership,” he says.
“The preferred option suggests that Australia considers adopting the type of targets that are currently in place in the United States.
“The targets in that country are supported by significant financial incentives yet the discussion paper makes no reference to any additional incentives to support the uptake of low emission vehicles,” Weber says.
“There is a great deal of further analysis to do and we look forward to continuing to work with the Government on the development of a standard that is right for Australia and supports Australian consumers.”
The AADA says the NVES impact statement is very technical and considers various options, but the government has stated that it has a preferred option of reducing the emissions by more than 60% for passenger vehicles and light commercial vehicles in just five years.
“On the surface this is an incredibly ambitious target which will be difficult to achieve especially for utes and large SUVs,” says AADA chief executive James Voortman.
“This could have consequences for affordability and vehicle choice,” he says.
“Other countries have reduced new vehicle emissions over a much longer time frame, with credits built into their standards.
“They have also offered generous incentives universally available for consumers to buy low emissions vehicles – the government’s preferred option could not be more different,” says Voortman.
“We are concerned that this policy goes too far too fast and that consumers will be the big losers, as will the local automotive businesses.”
The AADA says it will study the impact statement to understand the findings and consult with members – Australia’s more than 3000 new car dealers.
The Motor Trades Association of Australia (MTAA) scores government’s fuel efficiency standard seven out of 10, saying it will work to ensure settings allow for adequate supply of utes and commercial vehicles in the early years.
Representing more than 3200 dealers, 7800 auto repairers and almost 10,000 apprentices, the MTAA calls for further apprentice and training support to service the two million electric vehicles (EVs) forecast by 2030 and for the government to implement a fit for purpose “Automotive Industry Code” to ensure a smooth and fair transition.
“The government has had to balance two extremes – the car companies and the single focused EV lobby,” says MTAA chief executive Matt Hobbs.
“It has taken three governments and 12 years to reach this point.”
Hobbs says the argument is just about the fine details.
“Some adjustments are needed in the early years, especially in the treatment of utes.”
Hobbs says that as stakeholders resolve EV supply and range issues in Australia, the next challenge is to implement the required workforce.
“A good first step is to make more apprentices eligible for the New Energy Apprentices Program.”
The MTAA says it is concerned not all car companies will make the transition.
Australian automotive workers and small businesses need the Albanese government to have their back in this period of change with an Automotive Industry Code of Conduct to protect workers who are at the mercy of multinational companies, says the association.
“It is imperative the government develops an Automotive Industry Code to give Australian workers and businesses a fair go,” says Hobbs.
Meanwhile, the Australian Automobile Association (AAA) says the fuels and technologies driving the global car fleet are changing rapidly and have the potential to offer Australians greater vehicle choices, cleaner air, improved fuel security, and cheaper household bills.
AAA managing director Michael Bradley says the AAA and its members want Australians in the best possible position to adopt new vehicle technologies and choose the transport technology options that best suit their lifestyle, household budget, and commuting needs.
“The AAA encourages the government to release its modelling so the millions of Australians to be affected by this change can understand exactly what it means for them.”
The Electric Vehicle Council says the NVES’ introduction promises greater choice and lower fuel bills for Australian motorists, adding it will incentivise car manufacturers to ensure all new cars they sell, on average, meet benchmarks for efficiency.
“This means manufactures can still sell vehicles with heavy emissions, but they must be offset by sales of low or zero emission vehicles,” the EVC says, adding Australian cars use a third more petrol than American cars on average.
“This announcement from the federal government, when legislated, will give Australians a greater choice for the cars they want and put money back in their pockets through lower fuel bills,” says EVC chief executive Behyad Jafari.
Jafari says only Russia may remain the sole developed country without an NVES.
The Climate Council says a national fuel efficiency standard puts Australia on the road to fuel and pollution savings.
“The announcement gets us off the starter’s grid and on the road to cheaper, cleaner transport,” says Climate Council chief executive Amanda McKenzie.
