A drop in the fuel excise coinciding with the increasing price of a key ingredient in batteries could mean the price of electric vehicles (EVs) will not drop as quickly as renewable energy proponents hope.
Industry advocate Anton Vikstrom said lithium prices had risen in line with EV demand at the same time the federal government made a budget promise to halve the fuel excise for six months.
"We were hoping the cost of batteries would come down but there's been so much demand for EVs the price of lithium has gone up," Mr Vikstrom, a director of Good Car Co, said.
"We're a little bit worried that the price won't come down quickly enough. However, when petrol prices hit $2.20, that weekend I sold 10 cars."
Despite the changes, customers are still lining up to test-drive and order a new EV and Tesla's Model 3 is the fifth-top-selling vehicle overall in Australia, according to the Federal Chamber of Automotive Industries' VFACTS March report.
It was the first time Tesla released its sales data for comparison in the Australian market.
The brand came in behind Toyota's HiLux and RAV4, the Mitsubishi Triton and Mazda CX-5.
Electric vehicle figures showed NSW topped the states for EV sales in 2021, moving 7,430 vehicles, ahead of Victoria's 6,396 and Queensland's 5,342.
Nationally, sales of EVs have tripled in the past 12 months and Tesla had roughly half the market share in Australia, Mr Vikstrom said.
Supply was also a key obstacle to uptake, with wait times of up to six months on most EV models.
Volvo Cars Brisbane North general manager Neil Marsh and Toowong Mazda sales executive Charles Antiporda both said customers ordering a Volvo XC-40 or Mazda MX-30 now would not see their new cars until September.
Mr Marsh said this year a third of orders were for EVs and "inquiry levels were through the roof".
"Range and charging are the obvious questions people are asking, but they're not questions based around fear," he said.
Hurdles to EV uptake
Another Good Car Co director, Anthony Broese van Groenou, said the uptake of EVs in Queensland was "surprisingly high" but it was difficult to tell if the subsidy had made any impact because there was such low supply.
He said metropolitan residents were "really embracing EVs" but there was "still a fair bit to go in regional areas".
Queensland introduced a $3,000 rebate for new EVs that cost up to $58,000 last month.
The cap on the rebate is lower than in other states, but Transport Minister Mark Bailey said the Queensland government did not want to subsidise people "who can easily afford well-off vehicles".
Ellen Roberts is national director of Solar Citizens, a community organisation aiming to grow renewable energy use in Australia.
She wanted to see EV subsidies closer to $10,000 per car, like some countries in Europe offered, and other policy initiatives to attract EV manufacturers and make prices more affordable.
"Subsidies are a good start but they need to be part of a glossy package enticing those manufacturers to sell cars here," Ms Roberts said.
"Demand is outstripping supply and Australia is not a priority market because we don't have policies in place that will drive the scale."
While Volvo's $80,000 XC-40 did not attract any government incentive, Mr Marsh said the days of the petrol engine were numbered.
"The reality is it's the future, and all manufacturers, as time goes by, will have more models in different price brackets," he said.
"They're never going to be under $10,000 ... but all those gaps in the market will slowly fill."
Mr Vikstrom agreed and said the country was still "several years away from mass adoption of EVs", given government policy had only made Australia attractive to manufacturers in the past year.
However, he said Queensland's network of charging stations "all the way up the east coast" was something the state "should be really proud of".
Tesla, BYD to dominate market
Mr Broese van Groenou said companies specialising in EV production such as Tesla and BYD would dominate the market in coming years.
He said other car companies were forced to pay penalties overseas for making vehicles that contributed to carbon emissions, pushing up costs.
"Companies that only sell electric vehicles don't have to pay penalties and we will see them dominate the market," Mr Broese van Groenou said.
"They're in that unique place where they're a fair bit more affordable."
Once conventional vehicles and EVs reached price parity, Mr Broese van Groenou said there was "no reason why people wouldn't buy an EV".
He even imagined a future where owners of remote cattle stations would be able to charge their high-range EV from solar energy far more easily than it would be to drive to the nearest town for fuel.
"That will be in another few years, but again we're not going to get that until we get a change in federal policy," he said.
Second-hand vehicles
With the cost of new EVs still prohibitive for many, Good Car Co imports cheaper second-hand vehicles, but is disappointed they are exempt from Queensland's financial incentive.
"If the purpose of the policy was to increase uptake, it should be on every single vehicle at first time registration," Mr Broese van Groenou said.
Coming from Japan or the United Kingdom, second-hand EVs can start from $18,000, almost half the price of the cheapest new EV in Australia.
