Australia urged to follow US on fuel efficiency standards

Labor is being urged to rethink its New Vehicle Efficiency Standard after a crucial decision by US President Joe Biden.

Industry and the Coalition are urging Labor to rethink the NVES. Picture: NCA NewsWire / Gaye Gerard

Labor is being urged to “follow the US” in its New Vehicle Efficiency Standard after President Joe Biden handed down a significantly softened set of rules designed to encourage more EVs onto the market or else risk being out of step with the biggest global economy.

Originally expected to enforce strict regulations that would have forced manufacturer’s to scale back the production of petrol cars or face billions of dollars in fines, the Biden Administration’s final version of the EV mileage rule provided to automakers this week was much more modest, according to reports.

The revelations were met with demands from industry and the Coalition for Labor to rethink the NVES.

Motor Trades Association chief executive Matthew Hobbs – formerly the vice president of government relations for General Motors – said Labor had for weeks touted that it was simply following the example of the US in the design of the NVES and “mirroring” its partner.

He said the softening of the US rules needed to be met with a rethink of Australia’s fuel efficiency standard.

“If you are going to target the US, look at the carrots in the US system and make adjustments. Make sure the Australian system can work appropriately,” he said.

Opposition Energy Spokesman Ted O’Brien said Chris Bowen “refused to learn lessons from overseas”.

“Industry forecasts Labor’s car tax could jack up the cost of Australians’ favourite family car by up to $25,000 and favourite ute by up to $18,000, but Chris Bowen doesn’t listen and doesn’t care,” he said.

“President Biden is now pulling up the handbrake on his vehicle efficiency standard while Chris Bowen puts his foot on the pedal.”

The comments follow The Australian revealing significant concerns out of Thailand over the NVES, with the Thai Prime Minister claiming he had raised the issue, which would significantly impact Thai car manufacturers, with Anthony Albanese during AUSMIN this month.

Mr Albanese denied the issue was raised with him.

A spokeswoman for the Infrastructure, Transport Minister Catherine King said the government was aware of the US’s “publicly stated interest” in reviewing their standards, but that Australia was independent.

“The Albanese Government is designing an Australian New Vehicle Efficiency Standard for Australian conditions. We want Australians buying a new car to be able to choose from a wider range of models that are cheaper to run,” she said.

“Given 85 per cent of the car buying market including the US has been subject to an efficiency standard for many years, Australians have been losing out on increased choice and fuel savings. We have recently concluded a period of consultation over the preferred model for the new Standard, and are continuing discussions with relevant stakeholders over the final design.”