‘Car yards full of EVs people don’t want’: Mitsubishi Australia boss warns Labor over vehicle targets

The local Mitsubishi boss has declared car yards are brimming with EVs that people do not want to buy, and warned the price of petrol cars could rise unless Labor overhauls its ­vehicle-emissions standards.

Energy Minister Chris Bowen in Kwinana on Thursday for announcements on batteries and green hydrogen. Picture: Facebook

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The local boss of a Japanese ­motoring giant has declared Australian car yards are brimming with electric vehicles that people do not want to buy, and warned that the price of petrol cars could rise unless Labor overhauls its ­vehicle-emissions standards.

In a new front in the growing industry push for Anthony Albanese to revamp his climate and energy policy, Mitsubishi Motors Australia chief executive Shaun Westcott said the government needed to rethink the aggressiveness of its targets aimed at lowering the carbon footprint of new cars by 60 per cent by 2030.

The sector is anticipating the New Vehicle Efficiency Standard, which came into effect in January, would lead to car suppliers paying $2.7bn in fines by the end of the decade for missing carbon-­emission requirements.

Mr Westcott’s warning came as an executive of Toyota Australia – whose chief executive ­Matthew Callachor stood with Energy Minister Chris Bowen to endorse the scheme when it was introduced into parliament last year – has conceded the targets within the policy are “very ­challenging”.

Mitsubishi Motors Australia CEO Shaun Westcott. Picture: Brett Hartwig

Mr Westcott also urged the government to “recalibrate” its broader energy policy to ensure more reliability in the electricity grid, arguing that people’s confidence in buying electric vehicles was impacted when NSW residents were urged last year to turn off their appliances to avoid a wide-scale blackout.

“We need some rationality around the grid,” Mr Westcott said. “If you are truly serious about reducing emissions, there’s a gap between ambition and what is currently practically out there at the moment and there needs to be some reconciliation and consideration given to that gap.”

In the past two months, the food industry has called for the Albanese government to drop its 82 per cent renewables target to focus on bringing electricity ­prices down, while the Australian Chamber of Commerce and ­Industry has argued there needs to be a stronger focus on using more gas to create electricity.

Seizing on figures from the Federal Chamber of Automotive Industries that showed electric car sales had fallen since the ­vehicle-emissions standards were introduced, Mr Westcott said: “There is nothing we can do to force them to buy those vehicles.”

The FCAI this month released figures showing electric vehicles accounted for 5.9 per cent of total car sales in February, down from 9.6 per cent in the same month last year

FCAI, which represents major car suppliers, is claiming consumer demand for electric vehicles is down by 37 per cent this year compared with the first two months of last year, despite the implementation of the NVES.

Mr Bowen with new WA Energy Minister Amber-Jade Sanderson. Picture: Facebook

The Electric Vehicle Council argues that the NVES is working, with battery vehicles accounting for 11.3 per cent of car sales in ­February when plug-in hybrids are included.

This has been driven by a massive upsurge in hybrid sales ahead of tax incentives for those vehicles being phased out on April 1.

The council is urging the Albanese government to extend the tax break for plug-in hybrids rather than follow through with the Greens’ demand for it to apply only for pure electric models.

Mr Westcott said that, ­although there was previously an undersupply of electric vehicles in Australia, the problem had shifted to a lack of demand for them compared with the steep trajectory of the NVES, which has stricter requirements every year to 2030.

He said this would have the impact of forcing retailers to sell electric cars at a loss while also subjecting car makers to heavy fines for failing to meet the NVES targets, which would likely be passed on through price rises to petrol and diesel cars.

The carmaker’s warnings came as Climate Change and Energy Minister Chris Bowen announced four new large batteries for renewable energy storage and the approval of a green hydrogen project in Western Australia on Thursday.

Mr Westcott said a major problem on the demand for EVs was the lack of charging infrastructure, as he urged the federal government to commit to pouring more money into accelerating their rollout.

He backed estimates from some in the sector who have said the design of the NVES would require about half of new car sales to be electric by 2030.

“It is stated very simplistically that you can avoid the fines by bringing electric vehicles to Australia,” he said.

“The problem in the past is it was perceived there were not enough EV choices. The reality is – and the minister Bowen himself has called (it) out – the dramatic increase in the number of options and the variety of electric vehicles that are now available in Australia.

“You can take a horse to water, but we cannot force people to buy these cars.”

Mr Westcott said car companies were “facing the spectre of significant penalties and fines ­imposed on us for every diesel and petrol car that we sell”.

“At the same time many manufacturers are bringing electric vehicles to the market which are hard to find buyers for, which results in significant discounting on those cars to try and move them,” he said.

“Now that makes (electric) cars cheaper for consumers, yes, but at the end of the day you also have to look at sustaining the industry, we have got to keep the industry alive. The ambit of the fines and the penalties is probably going to ­exceed the profitability (of the car sector).”

Toyota Australia’s vice president of sales, marketing and franchise options Sean Hanley. Picture: Getty Images

Toyota Australia’s vice president of sales, marketing and franchise options Sean Hanley said Toyota supported the NVES, and “welcomed the certainty that this legislation provides in relation to future product planning”.

“What we would make clear is that the targets within the NVES are very challenging. Most companies – us included – are still working through the mechanics of it,” he said. “Regarding pricing, the NVES has only just come into effect and we will need to assess how the market responds. Toyota always strives to be competitive in the marketplace.”

He said electric and hybrid cars had accounted for 51.6 per cent of Toyota’s sales this year.

An Albanese government spokeswoman said the NVES was providing Australians with “choices”.

“We’re seeing more choice of cleaner, cheaper-to-run hybrids and electric vehicles coming to Australia,” the spokeswoman said. “Before we came to government, EVs represented less than 1 per cent of new cars sold. That’s now 10 per cent. And we’ve more than tripled the number of EV fast chargers on the road since coming to office – with more chargers installed in one term than under the entire LNP decade.”

Motor Trades Association of Australia chief executive Matt Hobbs said the review of the NVES was a chance to consider whether the policy was in line with international standards.