Cheap electric cars at least a decade away, says confidential industry report

cheap-electric-cars-at-least-a-decade-away,-says-confidential-industry-report

A leaked report has revealed how long it will take for zero-emissions vehicles to become affordable in Australia, and exposes the chronic shortage of recharging points.


Joshua Dowling

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Cheap electric cars are at least a decade away from Australian showrooms – and even then they will still be expensive by small-car standards – a confidential report commissioned by the Federal Chamber of Automotive Industries has forecast.

The leaked document – shared with Australia’s leading automotive companies last week – shows luxury-car buyers will be the driving force and the fastest adopters of electric vehicles over the next decade.

The report forecasts only 14 per cent of mainstream new-car sales in Australia by 2030 will be electric models, climbing to 21 per cent by 2033.



However, more than 60 per cent of luxury-car sales will be electric by the same deadline and climb to more than 70 per cent of the luxury sales mix by 2033, 10 years from now.

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Analysts say luxury buyers will lead the electric-car charge because the cost of the technology is expected to remain high given the vast mineral resources required to manufacture advanced high-capacity battery packs – and because it is easier to pass-on such costs in more expensive vehicles.  

The cheapest electric cars on sale in Australia today start from about $45,000.



However the report says the “cost of entry” into a new electric car won’t limbo to the low-$30,000 price range in Australia until 2030 or beyond.

The average price for most petrol-powered small cars today ranges from $20,000 to $30,000.

The forecast shows mainstream motorists in Australia who depend on affordable hatchbacks and SUVs – as well as utes, four-wheel-drives and vans – risk being left behind in the electric-car transition because those vehicle types are projected to be in limited supply and/or relatively expensive for at least 10 years.



The prices for the cheapest electric cars on sale in Australia today are at least 50 per cent dearer than their petrol-powered equivalents.

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The report – which forecasts only 18 per cent of all cars will be electric by 2030, and climb to only 25 per cent by 2033 – makes a mockery of the highly ambitious targets recently announced by some political groups and electric-car lobbyists who are pushing for an even faster rollout of zero-emissions or low-emissions vehicles.

If a 100 per cent electric-car mandate was put in place, the report warns, three out of every four mainstream new-car buyers would need to spend an extra $10,000 to $12,500 to purchase an electric versus a petrol hatchback or small SUV.



One car industry insider, speaking on condition of anonymity, said: “Special interest groups pushing for a 100 per cent adoption of electric vehicles in Australia have no grasp of the technical challenges, the cost challenges or the infrastructure challenges. There needs to be a measured response to the roll-out of electric cars, not a knee-jerk reaction that makes for great headlines.”

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Another high-ranking industry executive told Drive: “Electric cars will continue to be expensive and in relatively low supply for the next decade. What Australia needs is a policy that focuses on vehicle emissions reductions as a pathway to full electric vehicles.

“A sensible emissions reduction target sends the right signal to multinational car companies and strikes the right balance with consumers in Australia.”



As previously reported by Drive, a number of senior car industry executives have expressed the view that government policy should focus on reducing emissions across all engine types, rather than “rail-roading car buyers” into electric vehicles.

Last week Tony Weber, the chief executive of the Federal Chamber of Automotive Industries, repeated his earlier comments when he told Drive: “Consumers should have a choice and there is more than one way to reduce vehicle emissions,” said Tony Weber, the chief executive of the Federal Chamber of Automotive Industries.

“Government-mandated emissions targets would go a long way towards helping drive down vehicle emissions among the motoring masses, and encourage the introduction and adoption of more fuel-efficient petrol and diesel vehicles.

“Australia is a vast country with unique motoring needs; consumers need choice.”

While the leaked report noted the take-up of electric cars over the next decade was relatively small, it forecast the number of hybrid vehicles would continue to climb – and in the process help reduce Australia’s vehicle emissions – and the number of solely petrol or diesel vehicles would eventually fall to as low as 24 per cent of new vehicle sales.

The landmark report – commissioned by the peak Australian car industry body but compiled by research firm S&P Global (formerly known as Standard & Poor) – also showed Australia has a chronic shortage of recharging points.



At last count earlier this year, there were only about 1000 public electric-car charging points installed or promised across Australia.

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That number has since grown slightly – following pledges by various governments and electric-car charger providers – but still falls way short of what the industry has forecast as being the bare minimum to meet fleet targets.

Forensic market research firm S&P Global – which overlays consumer behaviour and sales results with government policy and future model plans from auto giants to calculate its findings – noted Australia has a chronic shortage of public and domestic electric-car recharging points.

The report forecasts 177,000 home chargers and 6800 public electric-car charge points will be needed by 2025 even to meet Australia’s modest rollout of zero emissions vehicles – and 724,000 home chargers and 6800 public electric-car charge points would be needed by 2030.

Joshua Dowling

Joshua Dowling has been a motoring journalist for more than 20 years, spending most of that time working for The Sydney Morning Herald (as motoring editor and one of the early members of the Drive team) and News Corp Australia. He joined CarAdvice / Drive in 2018, and has been a World Car of the Year judge for more than 10 years.

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