Five reasons the Govt's 'clean car discount' is great (and 5 reasons it's crap)
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The big news of today was the Government's unveiling of plans to shake up the local motor industry by offering subsidies on vehicles that are fuel efficient while simultaneously imposing fees on vehicles that aren't. 'Green' vehicles could get as much as $8000 slashed from their price, with so-called 'gas guzzlers' potentially lumped with a fee capped at $3000.
It's a move with the potential to completely reshape New Zealand's automotive landscape. The Government's hope is for the plan to be operational by 2021, with a six-week consultation period under way before the legislation will be introduced to parliament.
There's a lot to think about with this plan. So, here's 10 thoughts on the scheme — five great and five not so great — from the Driven desk.
Photo / supplied
1. Great: Cheaper EVs and hybrids — yay!
There's two key reasons why people stray from buying electrified vehicles (EVs in particular) — range anxiety and price.
While the industry is currently chipping away at the former with vehicles capable of longer ranges, the current global standard sees the latter traditionally taken care of by Government subsidies.
Even with $8000 slashed off the price, most fully electric vehicles still remain out of the range of everyday Kiwis (a fully electric Hyundai Ioniq, for example, will still cost $51,990 after the maximum discount). But this is still a fairly significant step towards making these kinds of technologies more accessible.
From a middle-New-Zealand perspective, the discounts on hybrids and plug-in will be more relevant. The cheapest locally available plug-in hybrid, the Toyota Prius Prime, becomes much more sensible on paper at $41,690 after a $6800 discount. The current cheapest hybrid meanwhile, the Prius C hatch, becomes a bit of a steal at $23,100 after a $4800 discount.
No wonder that Toyota was quick to announce its support of the plan, eh.
2. Great: Still enables choice, encourages some petrol vehicles
This isn't a ban on petrol vehicles. Thank goodness.
Those not phased by electrified offerings can still go and buy themselves a car powered by an internal combustion engine. In some cases, as outlined by the Herald, certain fuel-sipping cars will be granted a small discount anyway.
This raises another little bonus for enthusiasts ....
Photo / Matthew Hansen
3. Great: An end to NZ's obsession with utes and SUVs?
No, New Zealand's fixation with SUVs and utes isn't about to grind to a complete halt. I wouldn't be surprised at all to see the Ford Ranger and Toyota Hilux still be at each other's throats in years to come at the top of our national registration data. And, the growing number of hybrid SUVs shouldn't be ignored, either.
But, I can certainly see the sales of small crossovers in New Zealand mellowing. And likewise even the Oakley-wearing, vape-puffing crowd that buy two-wheel drive utes as fashion accessories would likely realise that there are better value propositions elsewhere.
This should be a godsend for the station wagon and the hatchback; both of which have been on the ropes for years.
4. Great: Environment forward, closes the tech gap between us and the rest of the world
The list of countries that offer incentives to buyers of EVs is long; ranging from Germany and France to America and China.
Yes, I know, doing things just because other nations are doing them isn't great logic. And no, the environmental benefits of EVs and hybrids aren't quite concrete thanks to lingering debate about lithium mining and all that jazz.
But, given over 80 per cent of New Zealand's energy is renewable (including hydropower, geothermal power, and wind), the environmental benefits within our own borders are undeniable.
There's also a high chance that this plan could help build the foundation for bringing in emission standards in New Zealand.
Photo / Matthew Hansen
5. Great: An incentive for manufacturers
There are plenty of electric cars available overseas that aren't available in New Zealand. Look at the Nissan Leaf as an example; a car that is incredibly ubiquitous on our roads these days but didn't actually come to our market as a new offering.
That sort of market dodging should soon be a thing of the past, especially given that only a handful of EVs are currently available in New Zealand for less than the $80,000 cap on the Government's feebate scheme.
The Leaf is thankfully set to go on sale here later in the year (although plenty of them are already in New Zealand as independent imports), and Toyota have also confirmed that the hybrid Yaris (a model that's been on offer in Europe for years) is also coming here.
It'd be great to see the hybrid versions of the Honda Jazz, Suzuki Swift and Ignis come here, but they're currently 'forbidden fruit'. Peugeot, with its new electric 2008 SUV, currently sit on the fence in regards to whether they'll bring it here. Schemes like this could get all manufacturers interested in sending their 'cheaper' EVs here.
1. Crap: Making the cheapest, most common Japanese imports even cheaper seems silly
According to the Herald, seven of the 10 most popular used vehicles sold to low-income households (across the 2009–2010 model year) are going to be eligible for a discount of some kind. Why?
As someone who learned to drive in a cheap Japanese import, who bought a cheap Japanese import as a first car, and currently owns a cheap Japanese import ... these things don't need to get any cheaper than they currently are.
Photo / supplied
If part of the goal here is to improve the age of the national vehicle fleet, then serving up discounts on already cheap $7000 Nissan Tiidas, Suzuki Swifts, and more isn't going to help. Perhaps this element of the argument should be restricted to new-vehicle sales.
And, there's another issue.
2. Crap: Will petrol and diesel 'gas guzzlers' be able to pay for it?
A big element at the crux of this proposed plan is that it would end up being cost neutral — as in, the money that goes towards discounts on 'green' vehicles will be paid for by the incoming money from the fees on so-called 'gas guzzler' vehicles.
Supposed guzzlers dominate the new-vehicle registration charts, but they're much less represented in New Zealand's private and independent imports. That aforementioned Herald list of most popular used imports from the 2009 and 2010 model year lists mainly small cars.
The only 'guzzlers' on the list are the Mazda MPV and Toyota Hiace.
Hopefully the Government has numbers that clarify their position. But, it's hard to see from where I'm sitting exactly how these plans can be cost neutral if such a huge number of imports coming into New Zealand are small, economical cars — almost all of which likely to come with a cost-sucking discount attached.
Another thought. If everyone stopped buying gas guzzlers tomorrow, how would the incentive be paid for?
Photo / supplied
3. Crap: Not many EVs actually fit into the scheme
This is less a gripe with the Government's scheme and more simply just a comment on the state of the industry.
I'm glad that there's an $80,000 cap on the scheme. If you're spending a six-figure sum on a Tesla Model S or an Audi e-tron, then you probably don't need the help of a generous subsidy.
But, in the absence of the top end of the market, very few fully electric vehicles can currently take advantage of the scheme. By my count, there's just eight of them; the Hyundai Ioniq, Volkswagen e-Golf, Kia Niro EV, LDV EV80 van, Renault Zoe, Renault Kangoo, and foundation variants of the BMW i3 and Hyundai Kona EV.
But, admittedly it's an evolving space. By the end of the year the Nissan Leaf and base-models of the Tesla Model 3 will have joined that group of sub-80k EVs. And there's lots more on the way, like the Honda e [pictured], Mini's EV, Great Wall's interesting EV ute, and more.
4. Crap: What about all that 'unsafe imported car' malarkey
Hmmm, yes. About that.
Last month, calls to ban 'unsafe used imports' from entering the Kiwi market gained momentum with the support of the Motor Industry Association. It was a messy thing, given that the definition of 'unsafe' hinged on the Government's Used Car Safety Ratings system — a system that appears to be flawed at best.
How interesting then that, less than a month after those claims, this plan comes out that would actually supply discounts for the two 'star' vehicles from the supposed 'ban' — the Suzuki Swift and the Mazda Demio. According to the Herald, both would be in line for a $1100 discount.
5. Crap: Good luck to tradies and farmers
For every person who uses their double-cab ute for urban peacocking and nothing else, there's half a dozen people who buy them because they actually need them — be it for work, recreational towing, or otherwise.
Those who work in the trade or agricultural sector might have a big price to pay through no fault of their own, given that hybrid and electric vehicles in the commercial space are so few and far between.
Photo / Matthew Hansen
Even with exciting stuff like the Rivian RT1 double cab making headlines, the commercial vehicle sector's embrace of EV and hybrid tech is a trickle at best. There are some examples out there, like the Nissan eNV-200 (not offered in NZ), Renault Kangoo, and LDV EV80. But there's nothing in the ute space (at least until that Great Wall arrives).
Most of that is because of the high cost and the range requirements that so many potential fleet buyers have. But, there are also engineering challenges to overcome, too. Like towing, for example.
The only EV currently for sale in New Zealand with an official tow rating is the Tesla Model X. That isn't to say that other EVs aren't capable of towing, but rather manufacturers are yet to find a solution for how towing throws vehicle range out the window.
That's a drama for those planning long trips away with the boat on the back, and an even bigger drama for those whose jobs would rely on trailer-related travel. A cabinetmaker delivering kitchen units, a brickie towing a commercial cement mixer, a forestry worker towing a load of firewood ... the list goes on.