Australia's Electric Vehicle Policy Needs a Jump Start: Government Must Act on Senate Committee Recommendations and Embrace an Electric Future

30 January 2019

Following the tabling of a report by the Senate Select Committee on Electric Vehicles, Centre Alliance Senator Rex Patrick has called on the Government to bring Australia’s policy in line with other developed nations and prohibit the sale and import of new internal combustion engines (ICEs) in motor vehicles by 2035.

The Select Committee’s report found that electric vehicles (EVs) are at the forefront of a major transformation of the world’s transport sector, and that widespread use of EVs in the Australian transportation fleet would deliver significant economic, environmental and health benefits to Australian consumers and society.

“The world is embracing EVs and we must too,” said Rex. “In relation to EVs it’s not a question of if, it’s simply one of when.”

“We also need to recognise there is substantial opportunity for Australia, leveraging off the considerable ongoing and residual automotive industry skill and experience, to become involved in the manufacturing of EVs and EV components in-country.”

Global EV sales are growing rapidly in Europe, Asia and North America, however the data from Australia paints a sobering picture and demonstrates that substantially more needs to be done to accelerate the uptake of EVs.

Recent annual sales figures show that, of over a million cars purchased in 2017, only a measly 2,300 were battery-electric vehicles or plug-in electric vehicles – about 0.2 per cent market share.

Australia's position is in stark contrast to other countries. While Australia has geographical challenges not faced by many European countries, the uptake of EVs through targets and the eventual prohibition of the sale of new ICEs is a challenge that should be met with tenacity and decisiveness; not put in the too hard basket.

There are also more than a dozen countries (including China, Germany and the US) that have announced they will ban the sale of new ICE vehicles. Further, the Volkswagen Group has announced that its next generation of ICEs, due in 2026, would be its last.

“It's clear the world and manufacturers are transitioning. This transition must be embraced by current and future Australian governments,” Rex said.

“The Government must abandon its Luddite approach to Australia's inevitable transition from ICE Vehicles to EVs.”

Funding for EV manufacturing and value chain activities, such as the manufacturing of EV batteries, is already available to the automotive sector. In 2011, the Parliament established the Automotive Transformation Scheme (ATS) to assist Australia’s automotive industry. Analysis undertaken by the Parliamentary Budget Office for former Senator Nick Xenophon in 2016 outlined the capped component of the ATS funding allocated to the program, funding that has been spent, estimated future spending and amounts of underspend.  

This analysis shows that the ATS underspend will be approximately $740 million. 

“This significant amount of money could and should be utilised for EV manufacturing and value chain support. Such a decision would very obviously be in Australia’s national interest,” said Rex.

“The Government must accept and implement the Committee's, the Chair's and Centre Alliance’s recommendations as a matter of urgency.”

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