Electric Vehicle Market Faces Challenges in New Zealand
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Industry Leaders Express Concern
Kirsten Corson, chair of Drive Electric, an organization representing the EV sector, described the situation as “really hard.” She acknowledged that changes to the clean car discount scheme and the introduction of road user charges had been communicated before the election, but the ACC levy increase came as a surprise. “It is indeed sending a message to the market which isn’t as positive as we would like,” Corson stated, emphasizing the desire for ”fair and equitable policies.” She highlighted the safety advantages of newer EVs, arguing that lower accident rates should be taken into account. Aimee Wiley, chief executive of the Motor Industry Association (MIA), expressed concern about the timing of the ACC levy increase, noting that it could negatively impact both the new vehicle industry and motorists. The MIA urged the government to carefully consider the broader implications of such policy decisions before implementation. “Effective policy changes must strike a balance and consider consumer affordability and economic, social, and environmental factors affecting New Zealand,” the MIA stated. They expressed deep concern about the fragile state of the EV market and warned that a decline in consumer demand could hinder the industry’s ability to meet CO2 emission reduction targets set for 2025.Expert Analysis of Market Impact
Brad Olsen, chief executive of Infometrics, observed that the initial incentives for EVs were always temporary and designed to stimulate early adoption. He acknowledged the government’s rationale for ensuring EVs contribute fairly to costs but noted that the combination of these changes, coupled with high inflation, creates a challenging economic environment. Olsen also pointed out that the fuel excise duty, which applies to petrol cars, may have historically “undercooked” the cost that petrol car users should be paying. He suggested that if a user-pays system based on road usage was implemented for all vehicles,the financial disparity between EVs and petrol cars would likely diminish. Registrations of new, full-battery electric vehicles have declined significantly, down 55% in the year to November compared to the same period in the previous year. Plug-in hybrids experienced a similar drop of 51%, while petrol vehicle registrations fell by 5% and diesel by 22%.EVs More Affordable Post-Rebate?
Despite the recent policy shifts, Aimee Wiley from the MIA argued that EVs are currently more affordable than they were with the rebate. She explained that while the price of EV technology was expected to decrease over time, the primary reason for the price drop is a shift in consumer demand. Reduced demand has led to larger inventories of EVs,creating more competitive prices for buyers. Electric Vehicle Sales Decline Following Policy changes
New Zealand’s electric vehicle (EV) market is experiencing a downturn following the removal of the Clean Car Discount and the introduction of road user charges for EVs. Industry experts say these policy changes have created uncertainty for consumers,leading to a decline in sales. “There’s never been a better time to buy [an EV] in terms of price point,” says Julie wiley, chief executive of the Motor Industry Association. “But the problem is once they’ve cleared their stock, the prices won’t stay like that forever.” She explains that distributors are facing notable losses, prompting them to clear out existing inventory at discounted prices. Despite the price reductions, EV advocates emphasize the long-term cost savings associated with electric vehicles. ”If people could charge their cars at home, they would cost the equivalent of 40 cents a litre to run,” says Wiley. however, the message surrounding EVs has been overshadowed by policy debates, according to advocates. “the messaging to the consumer has been heavily dominated by policy this year rather than features,” says sue Corson, chief executive of Drive Electric. She highlights the benefits of EVs: “EVs are newer, safer, cleaner but its a new technology and that comes with hesitation for some people to want to adapt.” Corson anticipates a similar impact on sales when ACC changes come into effect.Cost-Effectiveness and Future Outlook
Corson reassures consumers that EVs remain the most economical option for New zealanders. “They’re still the most cost-effective option for Kiwis to drive. If you’re charging at home after-hours, it’s a massive saving. If you’re charging overnight it’s about $3 per 100km.” This translates to significant savings compared to conventional vehicles, which cost about $20 per 100km. looking ahead, Wiley emphasizes the need to shift the focus from policy changes to the benefits of EV ownership. “What’s best for the consumer, what’s best for the environment. What do we want our fleet in New Zealand to look like in the future?” She argues that presenting EVs as a positive choice for consumers, rather than a political issue, will be crucial in driving adoption. Corson acknowledges that transitioning to an electric fleet will be a gradual process. “It takes decades to be able to flip your fleet,” she says, citing norway as an example, where over 90% of new car sales are electric after years of incentives. Corson believes that New Zealand, with one of the oldest and most polluting fleets in the OECD, will require time to catch up. She also suggests that the government should re-examine the equity of ACC levies and encourage the adoption of smart charging infrastructure. “That’s set to save us billions of dollars – as opposed to doing it retrospectively, which will cost twice as much,” Corson concludes.## Decline in Electric Vehicle Sales: Are Recent Policy Changes to Blame?
**Archyde News Talks to Kirsten Corson, Chair of Drive Electric**
**(Auckland, New Zealand)** – The New Zealand electric vehicle (EV) market is facing turbulent times. Following the removal of the Clean Car Discount and the introduction of road user charges for EVs, a marked decline in sales has raised concerns about the future of EV adoption in the contry.
To understand the situation better, Archyde News interviewed Kirsten Corson, Chair of Drive Electric, a prominent association representing the EV sector in New Zealand.
**Archyde News:** Kirsten, what’s your take on the current state of the EV market in New Zealand?
**Kirsten Corson:** It’s been a challenging year, to say the least. The removal of the Clean Car Discount and the introduction of road user charges were anticipated, but the recent increase in ACC levies for EVs came as a surprise. While the government communicated the initial changes beforehand, this sudden hike in levies sends a confusing message to the market.
**Archyde News:** How do you think this policy change affects consumer perception of EVs?
**Kirsten Corson:** it’s definitely sending a message that isn’t as positive as we’d like. While we understand the need for fair contribution, we believe that the safety advantages of newer EVs, which have significantly lower accident rates, should be factored into policy decisions.
**Archyde News:** The motor Industry Association (MIA) has expressed concerns about the impact on EV adoption targets. What are your thoughts on achieving the emissions reduction goals set for 2025?
**Kirsten corson:** We share the MIA’s concerns. The decline in EV sales directly impacts our ability to reach those enterprising targets. We need a consistent and supportive policy environment to encourage consumers to switch to EVs. It’s crucial to remember that meeting these emissions reduction targets benefits everyone in the long run.
**Archyde News:** What message would you like to send to the government regarding these policy changes?
**Kirsten Corson:** We urge the government to carefully consider the broader implications of these changes. We need a balanced approach that considers both the financial burden on consumers and the environmental impact.We want fair and equitable policies that encourage,rather than discourage,the adoption of electric vehicles.
**Archyde News:** Thank you for your time, Kirsten.
**(End of Interview)**
Koron’s comments highlight the complex challenges facing the EV market in New Zealand. While the government aims to encourage a transition to greener transportation, the recent policy changes risk undermining progress. The debate over balancing affordability, fairness, and environmental goals is set to continue as New Zealand navigates its path towards a sustainable future.
