Sales of electric vehicles across Australia have risen by over 400 per cent in the first five months of this year with the ACT experiencing a 350 per cent EV growth as one of the leading jurisdictions in the zero-emissions surge.
However, the numbers could be far higher if not for the crushing effect of long wait times for delivery to customers, with most brands now experiencing delays of more than 6 months and up to 12 months for popular models like the Tesla 3.
Canberra car czar John McGrath has confirmed that the wait time on even one of the most affordable and market-accessible EVs in Australia, the $44,000 Chinese-built MG, had blown out to over three months as a newer, bigger model comes off the production line in Shanghai.
The latest national vehicle sales data landed as the federal government quietly raised the price threshold at which the 33 per cent luxury car sales tax is imposed on "fuel efficient" vehicles to a new high of $84,916.
For all other vehicles, the luxury car tax cuts in at $71,849.
For the purposes of calculating the luxury car tax, a fuel-efficient car must have a fuel consumption that does not exceed 7 litres per 100 kilometres as a combined rating. Without an electric or highly efficient hybrid engine, no heavy luxury car can get under this fuel consumption target.
The election of a Federal Labor government is poised to bring a significant shift in the pricing structure of the electric vehicle market, which is currently dominated by vehicles in the $60,000-plus category, with the Tesla Model 3 - with 2022 year-to-date sales of 4481 - the dominant player.
In its pre-election pledge, Labor promised to abolish the 5 per cent import tariff fees for all electric vehicles, plug-in hybrids and hydrogen fuel cell vehicles priced under the luxury car tax threshold for low emission vehicles.
It said this would reduce the retail price of a new $50,000 EV, such as the Nissan Leaf, by approximately $2000, and provide an incentive for more manufacturers to push more EVs into the Australian market.
However, what could have a far bigger impact on demand is the additional pledge by the new government to exempt electric vehicles from the 47 per cent fringe benefits tax (FBT) for company vehicles provided to employees for private use.
In its pre-election campaign, Labor said this could save employers up to $9000 per vehicle per annum, thus driving the incentive for business to introduce more EVs to their fleets, and for private owners to transition to a novated lease and thereby gain even more benefit through salary sacrificing.
However, Labor's FBT exemption will only apply to vehicles which fall under the new luxury tax car threshold.
The world's busiest port, the 3600 square kilometre Port of Shanghai, was caught in a massive bottleneck during much of April and May as a result of the city's COVID-19 lockdown and it could take months for those issues to be resolved.
This has completely disrupted the shipment of Chinese-made EVs such as Tesla, Polestar (Volvo) and MG. Korean-made models such as the Hyundai Ionic 5 world car of the year winner and the Kia EV6 are under supply-side pressures from the global semi-conductor chip shortage, leaving Australia's relatively small, right-hand drive market as less of a priority than the US and Europe.
