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| The take-up of electric vehicles in Australia is about five to 10 years behind other advanced markets, says Andrew Fulbrook. Simon Dawson |
The take-up of electric vehicles in Australia is about five to 10 years behind other advanced markets, says Andrew Fulbrook, who leads a team of more than 30 analysts and engineers at British-based IHS Markit, which helps the world's biggest car makers decide what power trains to invest in.
While it makes sense for the government to promote electric vehicle adoption by consumers for climate commitments, Mr Fulbrook said he knows of no example in the world where that has happened without a collective push by governments and industry.
Environment Minister Josh Frydenberg issued a call to arms in January for consumers to embrace the "electric car revolution", which he said was "nigh".
Improvements in cost, range and infrastructure mean that by 2025, an estimated 230,000 EVS will be driven on Australian roads by 2025, and 1 million by 2030, Mr Frydenberg said.
The reality on the ground, according to car industry groups such as the Federal Chamber of Automotive Industries, threatens to be less impressive. Unlike Norway, where about 40 per cent of new cars are EVs, Australia's current fleet is just under 4000. Last year EV sales were 1126.
"Unless you back up the narrative and ambition with finance and funding, you'll struggle to reach that number," Mr Fulbrook told The Australian Financial Review on Tuesday. "In fact you'll find it virtually impossible.
"I've not seen an example anywhere of free market dynamics creating that kind of market or penetration with no intervention from government."
Mr Fulbrook cites the example of Germany, where the government is spending €1.2 billion ($1.9 billion) in subsidies to encourage the purchase of 400,000 EVs between 2016 and 2020. A similar scheme in Australia, would cost a couple of billion dollars, and may involve lowering the purchase price of a new vehicle by $4000 or $5000, he said.
Big challenges
The next stage of helping to establish an effective market to encourage car markers to sell into Australia involves the establishment of charging technology, which Mr Fulbrook says will be needed to bridge the gap through to the late 2020s, when battery technology will have developed enough to enable most drivers to run their vehicles without recharging during the day.
"In loose terms, it's a multibillion-dollar commitment if you want to sea-change the market like this," he said.
He cautioned that such an agreement may struggle given the lack of any solution to Australia's high-sulphur petrol stocks, which car makers blame for inhibiting the rollout of more efficient combustion engines.
"That's an argument that was dealt with many years ago by other mature markets.
"[But] politically, if you can't get around the table to solve this sulphur impasse, you've got much bigger challenges ahead when it comes to transformational change, like electrification."
Car makers will have the products to sell in coming years, but they are unlikely to bring it into a market if there's a "ball and tumbleweeds and nothing else" in place, he said.
Another risk is that Australian consumers find themselves in a world where they won't be able to buy a traditionally-powered car.
"The makers will still be there. [But] I don't think there will be any conventionally-propelled vehicles being produced for major market consumption in 2040.
"You're not going to succeed in dictating the direction of automotive technology. That's very much in the hands of Europe and China.
"There's nothing wrong with having the ambition to modernise the fleet in terms of the Paris climate change agreement, but the consumer needs to be readied and enabled.
"I'm not sure Australia is there yet."
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