EVs in Australia — Approaching 10% Penetration

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Great news: 9.5% of new cars sold in Australia in April 2023 were fitted with a plug. We are close to 10% penetration!

The growth appears to mainly be in PHEVs. That means all those Australians with solar on the roof can operate their cars for zero dollars, saving money, having fun, and being kind to the planet at the same time. We had to visit the Tesla showroom and service center this morning to get a new windscreen fitted — a rock hit it on the one-lane road on our way back from Gayndah. We were amazed at how busy they were. While we were there, we thought we might have a test drive in a Model Y — our next planned purchase — but they are booked out till this afternoon. Busy, busy, busy!

One of the first Tesla Model Y display vehicles in Australia. Photo by Majella Waterworth.

But let’s explore those Aussie market numbers. While European figures seem to be stuck in neutral, the Australian market is buying electric vehicles at a greater rate of knots. Quarter 1 2023 averaged around 8% penetration, and it looks like the second quarter will reach over 10%. There are several new models being released: the MG 4, the Cupra Born, the Ora Cat, and the Peugeot e-2008.

According to the Federal Chamber of Automotive Industries (FCAI), out of the 82,137 vehicles delivered during April 2023, almost 8,000 were electric — including PHEVs and BEVs. The Australian automotive market increased 1.3% over the same period in 2022.

10% penetration
April auto numbers for Australia. Chart courtesy of Robert Nicol.

“Electric vehicles (BEVs) accounted for 8 per cent of sales in April. This is well up from 1.1 per cent compared with April 2022 … this number would have been larger had the industry not faced global supply challenges,” FCAI Chief Executive Tony Weber said.

“It is worth noting that five out of the top ten models sold in April offer some form of electrification.”

In the overall sales charts, the Tesla Model Y came in 4th behind the Ford Ranger, Toyota Hilux, and Toyota RAV4. More Tesla Model Ys were sold than Hyundai i30s. The Tesla Model 3 ranked second in the passenger sedan market, just behind the i30. No wonder they were busy.

Electric vehicles delivered April 2023 (% of overall market):

  • Tesla Model Y: 2,095 (3.0%)
  • Tesla Model 3: 1,581 (1.6%)
  • BYD Atto 3: 1,118 (1.5%)
  • MG ZS EV: ? Unknown at this point
  • Volvo C40 Recharge: 133 (0.15%)
  • Polestar 2: 122
  • Kia EV6: 118
  • Hyundai Ioniq 6: 89
  • BMW iX: 71
  • Mercedes EQA: 71

As a flashback, these sorts of charts remind me of the numbers published charting the EV takeup in the US a few years ago. It appears that Volvo has increased its presence in the market and pushed the Polestar a little further down the chart. BYD and MG are battling it out for 3rd position behind Tesla. Later in the year, as both brands introduce more affordable models — the MG 4 (launched at Fully Charged Sydney) and the BYD Dolphin (yet to be launched) — I expect the competition to heat up even more. However, neither brand is in a position to challenge Tesla’s vastly superior lead.

Why so many big utes? We have a large technical and further education college near us that trains building, mechanical and carpentry apprentices. Their car park is full of large utes (light trucks) — Ford Rangers, Toyota Hiluxes, Mazda BT-50s, etc. I discussed this with my tax accountant and it appears that the larger utes get a much better tax break. An apprentice driving a large ute is able to write off all of their vehicle expenses against their tax. A smaller ute can only write off business use. So, the tax system is biased towards the larger, more polluting vehicles — distorting the market. I am told that New Zealand has now closed this loophole.

10% penetration
Teslas, BYDs, and Konas at the Orange Festival. Photo by Majella Waterworth.

Two years ago, electric vehicles accounted for 0.8% of new car sales in Australia. We have come a long way and are rapidly accelerating. In Queensland, the state government has doubled the rebate for new purchases of electric cars from $3000 to $6000, and banks are offering green loans with lower interest rates for electric car loans. On the home front, one of my neighbors is anxiously awaiting the delivery of her bright red Atto 3 secured on a novated lease with the backing of the federal government’s tax relief incentives.

Research by the Royal Automobile Club of Queensland has shown that the new $6000 rebate will have a positive impact on EV prices. They expect that it may even bring price parity. A new Toyota Corolla Hybrid sells for AU$36,000. So, a BEV in the low AU$40,000’s with the state government rebate would achieve this.

RACQ cites the example of the MG ZS Excite EV and its petrol counterpart: “the MG ZST Excite 1.3L would both cost around $1,032 per month to own and operate over a five-year loan. A Tesla Model 3 would be cheaper than its closest petrol comparison, the Honda Accord Vti Turbo 1.5, costing $1,534 and $1,550 per month respectively.”

The Club’s General Manager of Advocacy, Joshua Cooney, said: “RACQ has made it very clear that we don’t want any Queenslander left behind as the world transitions to more sustainable modes of transport, and part of that means making electric cars more affordable.”

“We’re expecting a rapid uptake in electric cars in the coming years and governments must prioritise funding to expand our network of charging stations to ensure we can keep up with demand,” Mr Cooney said. “It’s evident Australians and Queenslanders are hungry for sustainable cars and we need to be doing as much as possible to make EVs more affordable and convenient. The quicker we can increase the number of cleaner vehicles on the new-car market, the faster they will become available on the second-hand market, and that’s where we will see the real improvement on affordability and uptake.”

“As well as making EVs cheaper, we also think there needs to be investment in greater education to bring Queenslanders along for the electric transformation ride,” Mr Cooney added.

10% penetration
Tesla day out with Rado. Photo by Majella Waterworth.

Toyota led the overall auto market with 12,029 vehicle sales (approximately two thirds of these were HEVs), then in second was Mazda (6,926), then Kia (6,200), Hyundai (5,732), and Ford (5,047). Australia sources most of its cars from Japan, Thailand, and Korea. As you would expect, imports from China have increased by almost 70% in April.

I have registered my interest in test driving the Great Wall Motors Ora Cat, and yesterday morning the sales rep rang and told me that the vehicles are in the country. Management is waiting for all the demonstrators to be delivered to all dealers before allowing test drives — but it won’t be long! Hopefully, next week I will be behind the wheel of one of these beauties, and you will be reading about it soon after.

Viva la rEVolution!

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David Waterworth

David Waterworth is a retired teacher who divides his time between looking after his grandchildren and trying to make sure they have a planet to live on. He is long on Tesla [NASDAQ:TSLA].

David Waterworth has 748 posts and counting. See all posts by David Waterworth