Australian sales of electric cars have risen at record levels in the past six months and demand is expected to increase over the next 24 months.

Research shows electric car sales in the first six months of 2021 have exceeded the total amount sold in Australia in 2020, which was up from 2.7% the previous year. Australians now have access to 31 passenger electric vehicle models from 12 different carmakers and it is forecasted that an additional 27 electric vehicle models will enter the market by the end of 2022.

Incentives

With people coming to understand the benefits of electronic vehicles, particularly to the environment, many states and territories in Australia are creating incentives to encourage Australians to purchase electronic vehicles.

In Victoria, the government has announced that it will subsidise the purchase of new electronic vehicles through the Zero Emissions Vehicle Subsidy Program. The program involves a $3,000 subsidy on offer to eligible Victorian customers which will make purchasing an electronic vehicle more affordable. The program is currently open for applications.

Below is a graphic showing the incentives available all around Australia:

Federal Government delays

Australia is considered to be becoming a “dumping ground” for dangerous and polluting cars as the Federal Government delays its adoption to international emission standards.

More than 80% of the global car market now follows ‘Euro 6’ vehicle emission standards, however, Australia has shown resistance to signing up to the standards. The standards enforce more stringent restrictions on pollutants and require new cars to be manufactured to emit significantly less pollution.

This is creating issues for manufacturers who say it has created difficulties in selling their best vehicles to Australia, which require better quality fuel. The refusal to adopt the standards is also potentially endangering road users due to a decreased inability to access the newest safety features.

Impacts

The government’s hesitancy to adopt the standards is likely to impact all businesses within the automotive industry. There is a growing concern about the stock available to sell in Australia in the future if the infrastructure to facilitate the way of the future is not in place.

A lack of stock will result in the need for car dealerships to repair used cars to get them into a condition for resale, therefore decreasing profit margins which over time will lead to shrinking the motor vehicle industry.

The Australian Automotive Dealer Association are continuing to promote the benefits of the government providing facilities and infrastructure, which will allow for more fuel efficient and up to date model vehicles to be manufactured and continue to be sold across Australia.

Keeping a close eye on the government’s action and view over the next few months and years will shed a greater light on what the look of the automotive industry will look like here in Australia.

If you have any questions regarding the future of the automotive industry, or how your business may be impacted, please contact Daniel King on 03 5443 0344.