As petrol prices soar and climate change impacts make themselves felt, many people are likely wondering if their next car should be a fully electric vehicle.
Yes, the upfront costs are generally higher – but what does the future hold? Will prices fall in coming years and what costs do you need to factor into your decision?
The unfortunate truth is unless policy settings in Australia change, we shouldn’t expect a significant increase in the number of electric vehicles (EVs) available to Australians over the coming years.
It’s important we all start to make the switch to this cleaner technology, but unfortunately that choice is not available to many Australian households and businesses due to a lack of local, supportive policy.
EVs in Australia are currently A$15,000-20,000 more expensive than petrol or diesel cars. But in some market segments – like some sub-premium sedans priced between $60,000 and $75,000 – they are already at parity.
Several manufacturers have promised to bring more supply to the Australian market in 2022 but many of these vehicles were meant to be here in 2021 (with their arrival pushed back).
If you’re thinking of making the switch to an EV, here’s what to consider:
The reality, though, is that if there’s no change to policy settings, we can expect the EV market in Australia to stay much the same this year and for many years to come.
This means many Australians won’t have a choice but to continue to pay for expensive imported fuel, instead of using cheap Australian energy to power our vehicles.
There’s a vast range of EV models. It’s just that most of them aren’t sold in Australia.
One of Australia’s disadvantages is we are a market for right-hand-drive vehicles, and many European and American EVs just aren’t built that way. The UK is also a right-hand-drive market, where people have similar average incomes and quality of life compared to Australia. But the EV market there is very different with more than 160 EV models compared with around 50 in Australia.
The key difference is the UK has a (conservative) government that has embraced the technology and understands the broader economic benefits of making EVs easy for people to get and run.
Yes, Australia has boosted EV charging infrastructure but that’s not enough to encourage manufacturers to bring more models to this country (which would help get more affordable EVs on the market).
How would the Australian market look if we did have supportive policy? Well, there are about 80 million cars sold worldwide each year, around 1 million of which are sold in Australia. So we are about 1.3% of the global car market.
There were about 6.6 million EVs sold worldwide in 2021. So 6.6 million x 1.3% equals about 85,000 cars. That’s 85,000 EVs that should have been sold here last year if our market was in line with global trends.
But in fact, the number of EVs sold here was just over 21,000 in 2021. So we are about a quarter of the size we should be.
There’s plenty of demand for EVs in Australia, we just cannot get enough delivered because we haven’t got the right policy settings.
Policies that would help make EVs more affordable in Australia include:
Not much will change in Australia unless there’s a change in policy. We are competing with markets that have the right policies to stimulate EV sales. The manufacturers are, of course, going to prioritise supply there.
There will be small increases in EV sales in Australia every year. But it will take a number of years for the supply of these new vehicles to ramp up.
I’m sorry to be the bearer of bad news. And I do hope your next vehicle purchase is an EV, after considering all of the costs over the life of the vehicle. It is the right thing to do for the climate and the long-term savings are attractive, especially if fuel prices continue to be so volatile.
Unfortunately, though, Australians should not expect EVs to suddenly become cheap and easy to buy here in the next couple of years – unless policy changes.
This article was written by Jake Whitehead, Tritum E-Mobility Fellow & Advance Queensland Industry Research Fellow, The University of Queensland and was republished from The Conversation under a Creative Commons license. Read the original article.