Electric cars?

[mullokintyre]

In the Weekend Australian motoring Journalist Stephen Corby suggests that the Top EV models could be "thousands cheaper".

Electric vehicles in Australia could be not just cheaper, but tens of thousands of dollars less expensive if the federal government took the approach widely used in Europe by slashing luxury car tax, import duty, stamp duty and GST on EVs.

Those financial incentives would remove one of the biggest barriers to EV uptake – the high price of entry – and encourage car makers to bring more zero-emissions vehicles to Australia.

Modelling by The Australian shows EVs could cost between 10 and 25 per cent less by removing taxes and providing other incentives, pricing them more competitively with petrol alternatives.

The problem is that all this approach merely subsidises the profits of overseas car makers.
Europe can ease tax , stamp duty etc because the profits from them come back to the European countries.
We don't mass produce any cars, any more, indeed we don't even do the Knock down kits that were the bulk of oz cars back in the 70's.
AS usual, those with the most money want someone else to subsidise their EV.
All of these same foreign car manufacturers outsourced their building to cheap labour in Asian countries.
They have all said they will stop building ICE engines by 2030 or earlier.
Then Australian buyers will have no choice.
The manufacturers will be able to charge whatever they like, so why do they want subsidies now?
Mick

 

[Value Collector]

In the Weekend Australian motoring Journalist Stephen Corby suggests that the Top EV models could be "thousands cheaper".

The problem is that all this approach merely subsidises the profits of overseas car makers.
Europe can ease tax , stamp duty etc because the profits from them come back to the European countries.
We don't mass produce any cars, any more, indeed we don't even do the Knock down kits that were the bulk of oz cars back in the 70's.
AS usual, those with the most money want someone else to subsidise their EV.
All of these same foreign car manufacturers outsourced their building to cheap labour in Asian countries.
They have all said they will stop building ICE engines by 2030 or earlier.
Then Australian buyers will have no choice.
The manufacturers will be able to charge whatever they like, so why do they want subsidies now?
Mick

The problem is though, adding a $10,000 battery to a car can push it over into the luxury car price, so it becomes a tax on batteries, not luxury cars.

The luxury car tax was originally brought in to discourage imports, how ever with all cars being imported these days it’s actually doing the opposite.

By taxing batteries, you are encouraging the importing of Oil for the life of the car, and transferring energy jobs over seas.

However if you encourage the use of electric cars you are creating less energy imports, and increasing demand in Australia’s local energy sector, that employs people all over Australia.

not to mention making the air cleaner in our cities is good for everyone, regardless of the income level of the person driving.

 

[mullokintyre]

The problem is though, adding a $10,000 battery to a car can push it over into the luxury car price, so it becomes a tax on batteries, not luxury cars.

The luxury car tax was originally brought in to discourage imports, how ever with all cars being imported these days it’s actually doing the opposite.

By taxing batteries, you are encouraging the importing of Oil for the life of the car, and transferring energy jobs over seas.

However if you encourage the use of electric cars you are creating less energy imports, and increasing demand in Australia’s local energy sector, that employs people all over Australia.

not to mention making the air cleaner in our cities is good for everyone, regardless of the income level of the person driving.

Sorry Vc, but that does not wash.
Why highlight the battery?
Why not the seats, or the tyres, or the electric engine or any part of the vehicle?
If an electric vehicle industry or battery industry were established here in OZ, it would make sense to subside them.
As for transferring energy jobs overseas, virtually everything renewable has already been transferred overseas.
We import batteries, solar panels, wind turbines, controllers, and now the whole cars themselves.
The Article highlights the cost of cars that with or without taxes, subsidies etc are well beyond the economic reach of the majority of Australians.
If it were not so, we would all be driving Porsche Cayenes are Audi A8's.
It is just another demand of the wealthy to subsidise their lifestyles by the other taxpayers.

Mick

 

[rederob]

In the Weekend Australian motoring Journalist Stephen Corby suggests that the Top EV models could be "thousands cheaper".

The problem is that all this approach merely subsidises the profits of overseas car makers.
Europe can ease tax , stamp duty etc because the profits from them come back to the European countries.

Removing taxes - which is an issue affecting government revenue - is not the same as granting an overseas manufacturer any benefit as their profit margin would not be affected.

AS usual, those with the most money want someone else to subsidise their EV.

Your "those with the most money" argument is nonsense. Compliant high spec EVs could be landed in Australia from around $25k (which is less than half of what I paid for my son's car earlier this year), and the one I have linked to now has many other counterparts in mid-size and SUV range which are already price competitive when cost of ownership considerations are accounted for.

All of these same foreign car manufacturers outsourced their building to cheap labour in Asian countries.

While Asian cheap labour is definitely a factor, my GM hire car in Uzbekistan - a high end Chevrolet - was locally made, while in Europe Slovakia is renown for being the highest manufacturer of vehicles on a per capita basis. That said, every major car manufacturer has a joint venture arrangement in China because it's not only the world's biggest car market, it's production infrastructure and technology is now superior to all but Tesla.

They have all said they will stop building ICE engines by 2030 or earlier.

The early cessation of ICE vehicle production is moot. Battery manufacturing constraints are the only impediment to BEVs being most of the new car market from 2025, but based on CAGR whatever ICE vehicles will be sold, they won't be price competitive beyond that date. That's in part why Korea and Japan have continued to develop hydrogen powered vehicles.

Then Australian buyers will have no choice.

That's a policy constraint rather than an issue of choice per se. Chinese buyers have access to locally compliant cars from under US$5k and they have literally hundreds of vehicle choices available. It's not a stretch to land compliant BEVs in Australia from $10k.

The manufacturers will be able to charge whatever they like, so why do they want subsidies now?

I think you have lost the plot on that point!

In any case, Australia will not be getting the cheaper EVs until there is a major policy shift, as this market will be continue to be dominated by European purchasers.

 

[Value Collector]

Sorry Vc, but that does not wash.
Why highlight the battery?
Why not the seats, or the tyres, or the electric engine or any part of the vehicle?
If an electric vehicle industry or battery industry were established here in OZ, it would make sense to subside them.
As for transferring energy jobs overseas, virtually everything renewable has already been transferred overseas.
We import batteries, solar panels, wind turbines, controllers, and now the whole cars themselves.
The Article highlights the cost of cars that with or without taxes, subsidies etc are well beyond the economic reach of the majority of Australians.
If it were not so, we would all be driving Porsche Cayenes are Audi A8's.
It is just another demand of the wealthy to subsidise their lifestyles by the other taxpayers.

Mick

I highlight the battery because that is the main thing that makes electric cars more expensive, because a battery costs more than a fuel tank.

All cars have seats, motors etc, but if you have two cars that are equivalent in every way except one is electric and one is petrol, the electric one will be more expensive to make due to the battery.

Removing the luxury vehicle tax isn’t a subsidy, but you could also just increase the price at which it kicks in for zero emission vehicles, As I said, both rich people and poor people breathe the same air, if you reduce the taxes on ev’s you help more of the middle class have them as an option, and that would clean the air for everyone.

 

[sptrawler]

Tax is taken by the Governments to pay for their services, if the tax is taken off E.V's it has to be applied somewhere else, I suppose the excise on fuel could be increased to compensate for the reduction in gst etc on BEV's? But that would affect those who can least afford it the most.

The luxury car tax from memory kicks in at around $70k, as @ rederob says there are plenty of EV's available under that price, so having a subsidy for a high end car really doesn't help the lower socio economic group, which are really the ones that would benefit the most from an EV.

The fact is the price and affordability of the lower end EV's needs to be improved, that will come with economies of scale, as is happening in China, it is the same as all new technologies as it becomes more commonplace it becomes cheaper.
A person can still go into Big W, K Mart etc and buy a $100 mobile phone, or the person can go and but a $1,500 dollar phone, why should the taxpayer contribute toward the $1,500 phone? when it would probably be more cost effective and be a better social outcome if the taxpayer helped make the $100 more accessible to the needy?

 

[rederob]

The fact is the price and affordability of the lower end EV's needs to be improved, that will come with economies of scale, as is happening in China, it is the same as all new technologies as it becomes more commonplace it becomes cheaper.

The fact is that EVs are already affordable on a life cost basis, and even more affordable in countries where the choice is so wide. Lower-end EVs are as cheap as equivalent ICE but none are available here. The other point is that EVs tend to be more technologically advanced and are loaded with safety features.
There is a lot of talk about range anxiety in Australia, but on the basis of needing a vehicle for work, fewer than one million Australians travel more than 50 kilometres a day:

Outside of work, my regular travels to the Gold Coast on a weekend by way of example, are less than 100km each way, so with a decent charging infrastructure I could get by with an EV that had about 150km real world driving range. That said, most model variants include larger battery pack options.

A person can still go into Big W, K Mart etc and buy a $100 mobile phone, or the person can go and but a $1,500 dollar phone, why should the taxpayer contribute toward the $1,500 phone? when it would probably be more cost effective and be a better social outcome if the taxpayer helped make the $100 more accessible to the needy?

If the taxpayer isn't contributing anything then what difference does it make? By way of any revenue offset, should that be a policy option, then a tax on sugar in drinks and manufactured foods could easily raise billions each year, and has a health benefit.
A different option again would be tax concessions based on vehicles with V2G or V2H capacity. That option alone would negate the need for Snowy2.
A further option that has a societal payback would be tax concessions based on vehicle accident avoidance capacity.
Yet another option would be to cap tax concessions at a landed cost of up to AU$35k, which is about $5k less than the average price of cars purchased in Australia. That option would not be such a burden on the revenue base and improve affordability at the lower end of the price scale.
On the issue of cost of batteries, LiFePO4 (which I will just call LFP from now on) are much cheaper than Lithium Ion batteries and have a longer cycle life, eg 2000 cycles on 100% discharge. So while batteries can be a major initial cost, LFP batteries can have a future well beyond the present 10 year average age of Australian cars.
The final consideration for any ICE car buyer now is the residual value at time of transition to an EV. An interesting aside is that in Norway second hand EVs are sometimes selling for close to their original price as nobody wants an ICE and the waiting list for preferred new EVs is long.

 

[Value Collector]

Tax is taken by the Governments to pay for their services, if the tax is taken off E.V's it has to be applied somewhere else, I suppose the excise on fuel could be increased to compensate for the reduction in gst etc on BEV's? But that would affect those who can least afford it the most.

The luxury car tax from memory kicks in at around $70k, as @ rederob says there are plenty of EV's available under that price, so having a subsidy for a high end car really doesn't help the lower socio economic group, which are really the ones that would benefit the most from an EV.

The fact is the price and affordability of the lower end EV's needs to be improved, that will come with economies of scale, as is happening in China, it is the same as all new technologies as it becomes more commonplace it becomes cheaper.
A person can still go into Big W, K Mart etc and buy a $100 mobile phone, or the person can go and but a $1,500 dollar phone, why should the taxpayer contribute toward the $1,500 phone? when it would probably be more cost effective and be a better social outcome if the taxpayer helped make the $100 more accessible to the needy?

Tesla’s Model 3, is about $10k over the luxury vehicle tax for the standard range and more for the long range version, so you can say it’s pretty much the battery that is being taxed, and the long range battery taxed even more.

If you talk to most people the biggest thing stopping them getting an EV is range, the more range you want the bigger the battery, and the more expensive the car.

Rich people will by the car regardless, but adding $5K tax can be a deal breaker for a lot of middle class folks who would be stretching to get an EV to begin with before the tax.

I reckon Tesla should sell the batteries separately and install them on the day you pick up the car, that would avoid the tax hahaha.

 

[Value Collector]

Tax is taken by the Governments to pay for their services, if the tax is taken off E.V's it has to be applied somewhere else, I suppose the excise on fuel could be increased to compensate for the reduction in gst etc on BEV's? But that would affect those who can least afford it the most.

The luxury car tax from memory kicks in at around $70k, as @ rederob says there are plenty of EV's available under that price, so having a subsidy for a high end car really doesn't help the lower socio economic group, which are really the ones that would benefit the most from an EV.

The fact is the price and affordability of the lower end EV's needs to be improved, that will come with economies of scale, as is happening in China, it is the same as all new technologies as it becomes more commonplace it becomes cheaper.
A person can still go into Big W, K Mart etc and buy a $100 mobile phone, or the person can go and but a $1,500 dollar phone, why should the taxpayer contribute toward the $1,500 phone? when it would probably be more cost effective and be a better social outcome if the taxpayer helped make the $100 more accessible to the needy?

If Air pollution is reduced, the government’s health care spending of $2Billion related to air pollution will be reduced.

Also, both federal and state governments are invested heavily in Electricity, higher utilisation rates of these investments will increase revenue for the government.

Also the government could lease space for renewables such as offshore wind and hydro projects as they do in the UK which would increase government revenues from cash that would normally be going to Saudi Oil princes.

 

[sptrawler]

If Air pollution is reduced, the government’s health care spending of $2Billion related to air pollution will be reduced.

That should help with the loss of about $12 billion in fuel excise tax, like I said tax has to be looked at in an overall view, rather than in isolation.
But whether people like it or not EV's are here to stay and it is just a case of how the transition happens that matters.

 

[sptrawler]

I reckon Tesla should sell the batteries separately and install them on the day you pick up the car, that would avoid the tax hahaha.

Agreed, I think the battery should be a lease item.
Which IMO is the way I think it will end up panning out, the disposal/recycling/repurposing of old EV batteries will have to be regulated IMO.
The last thing the government will want is backyard battery chop and hock shops, way too many nasty chemicals/ safety issues and fire issues, the easy way to address it is leasing the batteries and regulating the lease companies.

 

[Value Collector]

That should help with the loss of about $12 billion in fuel excise tax, like I said tax has to be looked at in an overall view, rather than in isolation.
But whether people like it or not EV's are here to stay and it is just a case of how the transition happens that matters.

Sorry, I under estimated, it’s $11 Billion to $24 Billion in healthcare costs related to air pollution.

The health costs from mortality alone are estimated to be in the order of $11–24 billion per year (Begg 2007, Access Economics 2008). The health risk assessment undertaken for the review of Australia’s air quality

Health impacts of air pollution

The major aim of monitoring and reducing air pollution is to reduce its adverse impacts on human health. Other aims are to prevent loss of amenity—for example, because of poor visibility or offensive odour, damage to vegetation, and corrosion of buildings and other infrastructure.

soe.environment.gov.au

 

[Value Collector]

This document from 2002 says that Sydney alone had health care cost of about $4.7 Billion related to air pollution, and 3000 deaths.

https://www.environment.nsw.gov.au/-/media/OEH/Corporate-Site/Documents/Air/air-pollution-economics-health-costs-greater-sydney-metropolitan-region-050623.pdf

 

[sptrawler]

Sorry, I under estimated, it’s $11 Billion to $24 Billion in healthcare costs related to air pollution.

The health costs from mortality alone are estimated to be in the order of $11–24 billion per year (Begg 2007, Access Economics 2008). The health risk assessment undertaken for the review of Australia’s air quality

Health impacts of air pollution

The major aim of monitoring and reducing air pollution is to reduce its adverse impacts on human health. Other aims are to prevent loss of amenity—for example, because of poor visibility or offensive odour, damage to vegetation, and corrosion of buildings and other infrastructure.

soe.environment.gov.au

That sounds better.

 

[Smurf1976]

But whether people like it or not EV's are here to stay and it is just a case of how the transition happens that matters.

Yep, it's going to happen and at this point it's much like computers, smartphones, highways, cars themselves, air-conditioning or anything else.

Some will come up with arguments against but it'll happen regardless. Either you're on the train or you're standing on the platform yelling but either way it's departing right now.

Cars as such are here to stay and they're going electric with the only questions being around the detail.

 

[qldfrog]

Yep, it's going to happen and at this point it's much like computers, smartphones, highways, cars themselves, air-conditioning or anything else.

Some will come up with arguments against but it'll happen regardless. Either you're on the train or you're standing on the platform yelling but either way it's departing right now.

Cars as such are here to stay and they're going electric with the only questions being around the detail.

I somewhat doubt EV as we see them with battery will be there to stay, i expect them to be transition only.
Maybe ev recharge with ammonia cells, hydrogen cells or just battery swap But the concept of going and charging your EV car at a station for even 20 minutes..nope..
And always put this in the concept of the reset, individual cars have no place, and only concern is city dwellers so shared cars taxis/ubers and public transport, you own nothing, be happy and do not travel
These taxis and automated transport will probably be EV but without lithium batteries..20y will tell us more

 

[rederob]

The chart below, produced by VW, shows why Europe will get all the EVs they can lay their hands on:

The obvious downside by way of comparisons, is range. However, as noted previously, battery pack upgrades are available and the additional cost is in a fashion recoverable by way of energy storage capacity after the life of the vehicle.

Despite the present high cost of the very few EVs available in Australia, purchasing one now or sooner rather than later is likely to pay off. That's because you will be able to offset the higher price today against the retained resale value (assuming a holding period of at about 3 years).

 

[mullokintyre]

The chart below, produced by VW, shows why Europe will get all the EVs they can lay their hands on:
View attachment 133542
The obvious downside by way of comparisons, is range. However, as noted previously, battery pack upgrades are available and the additional cost is in a fashion recoverable by way of energy storage capacity after the life of the vehicle.

Despite the present high cost of the very few EVs available in Australia, purchasing one now or sooner rather than later is likely to pay off. That's because you will be able to offset the higher price today against the retained resale value (assuming a holding period of at about 3 years).

So how many do you own now?
Mick

 

[moXJO]

The big problem is that you can't get a decent range of evs in Australia yet.

 

[Value Collector]

The big problem is that you can't get a decent range of evs in Australia yet.

The Tesla model 3 which is Australia’s leading EV, gets over 400kms range, that’s pretty decent in my opinion, it’s pretty much equal to most people fuel tank.

The added benefit though is you don’t have to go to a petrol station, if you arrive home with 5% charge you just plug in and it’s back to 400km range again in the morning.

Also, let’s say you did have to drive 500km in one day, so you need to charge some where through out that day, you don’t have to charge up to 100%, you just plug in for 5 or 6 minutes to get that extra 15% of so to get you home and then top up at home

This happened to me the other day, (for the first time in 2 years), I was driving round the city all day running errands, and by the time I was ready to head home it calculated that I would arrive home with 6% charge, that was a bit close for me so I stopped at a charger for literally only 3 mins, in which I took on about 15% charge then I drove home and plugged in.

Almost no one is going to be driving more than 400km without Stopping for a few minutes, And you won’t be driving 400km without passing a charger some where along the way.

to be honest when you plug in at home each time you park, it actually seems like you have unlimited range, because you almost never make traditional stops for fuel, your car is just always ready to go with a full tank.