Government softens vehicle emissions targets for utes, 4WDs

The federal government has responded to industry concerns about its new vehicle efficiency standard and made concessions for work vehicles and 4WDs.

The federal government will water down its controversial new vehicle efficiency standard (NVES) before introducing it into parliament tomorrow.

It is believed the government will soften the CO2 targets for utes and some four-wheel-drives in response to industry concerns they were too tough.

It will also slow the trajectory of the scheme, with more reachable targets early in the five-year plan and a steeper curve towards the end.

The NVES is designed to encourage the take-up of electric vehicles by introducing a mandatory CO2 emission target for car manufacturers. Those that fail to meet the target will be fined $100 for every gram of CO2 per km over the target.

The move to soften the blow on car companies comes after the Biden administration readjusted its own emission targets due to pressure from unions and the car industry.

Car industry groups have argued that the government’s proposed standards are the toughest in the world and could lead to significant price rises on popular utes. They say the new standards could force some brands out of the country.

2023 Toyota HiLux GR, Ford Ranger Wildtrak X, Volkswagen Amarok PanAmericana comparison test. Photo: Mark Bean

It is believed that the CO2 targets for passenger vehicles will be left untouched but the targets for commercial vehicles such as utes will be wound back.

In another concession it is believed that some heavy duty four-wheel-drives will be reclassified, moving from the passenger vehicle segment into commercial vehicles.

Four-wheel-drive wagons based on ute platforms – referred to in the industry as body on frame and designed for load carrying – were initially required to meet tougher passenger car targets but they have been reclassified as they are used for work purposes.

They include vehicles such as the Ford Everest wagon, which is based on the Ford Ranger ute and the Toyota LandCruiser, which is used extensively by farmers and tradies.

They are also favoured by those who tow boats, horse floats and caravans.

Off-roaders such as the Ford Everest will be the big winners from the changes. Picture: Supplied.

It is believed the reclassification will affect less than 10 per cent of new vehicles.

The government has not budged on other concessions floated by the car industry, including the awarding of “super credits” for EV sales.

In the United States, the government added a multiplier to EV sales that made it easier for makers to meet targets. If a car maker sold one EV it was treated as 1.5 vehicles.

The government has also declined to apply “off-cycle credits”, which are used in the US and Europe.

Climate Change and Energy Minister Chris Bowen has tweaked his tough new emissions standards. Picture: NCA NewsWire/Martin Ollman.

Under those schemes, manufacturers are rewarding for fuel-saving and CO2 friendly technology on their cars, allowing them to reduce their targets. Credits are awarded for low CO2 airconditioning and stop-start technology, which switches off the engine at the lights to save fuel.

One industry insider said neither EV advocates nor car manufacturers got everything they wanted out of the revised scheme.

“It is still very ambitious, but it’s workable,” he said.

The changes are unlikely to sit well with the Greens, though.

While the legislation should sail through the House of Representatives, it may face delays in the Senate.

Originally published as Government softens vehicle emissions targets for utes, 4WDs