New Zealand’s climate change mitigation intentions appear to be hitting another wall.
Already the Government has had to concede that two-thirds of the Nationally Determined Contribution target to reduce greenhouse gases by 2030 will be met by means other than actually cutting the gases.
Now the proposed ambitious Electric Vehicle targets are being attacked by the motor vehicle industry as simply not workable.
In submission after submission on the Land Transport (Clean Vehicles) Amendment Bill, the car companies and their industry associations are saying there are not enough EVs available to meet the targets.
Their submissions raise more questions about the political judgement of Transport Minister Michael Wood, who has already had to backtrack on the now-scrapped Auckland Habour Bridge Skypath.
The car companies say that the result of the Government’s proposals will be more expensive cars as purchasers pay penalties for vehicles that don’t meet the new standard.
Motor vehicle emissions are the fastest-growing source of Greenhouse Gas (GHG) emissions and account for 20 per cent of New Zealand’s total emissions.
The bill proposes that New Zealand imports meet the European Union emission standard for 2030 but that we meet it by 2027.
But Greig Epps, Advocacy and Strategy Manager for the Motor Trade Association, told Parliament’s Transport and Infrastructure Committee yesterday that the Government’s proposals were risky.
“We’re not going to achieve these targets, and the penalties that will then be imposed will simply flow through and higher-priced vehicles,” he said.
In their submissions, the companies have said the main issue will be sourcing vehicles that meet the standard.
Ford New Zealand CEO Sam Rutherford told the Committee there were aspects to the New Zealand car market that were different to overseas markets.
It was small and needed right-hand drive vehicles. Early development of Electric Vehicles (EVs) had been directed towards left-hand drive markets.
“Moreover, the New Zealand fleet is not comparable to that of markets that currently have ambitious 2030 CO2 targets, as it is dominated by dual-use, primarily light commercial vehicles that are designed to support primary producers and tradespeople,” he said.
“Engineering these vehicles to be compatible with CO2 reduction ambitions and fit for their intended purpose, and making them available in New Zealand in sufficient quantities, will require significant resources and time.”
Rutherford was talking about utes which will be subject to the much-criticised “ute tax” where buyers will pay a penalty for high emitting petrol and diesel utes from next year.
The high-emitter fees will be based on a sliding scale of CO2 emissions from 192g/km of CO2 and up, so they will vary from vehicle to vehicle and even on different models of the same vehicle.
The maximum charge a high-emitting vehicle will attract is $5,175 for a new vehicle or $2,875 for an imported used one.
Farmers have been particularly vocal about these penalties, and the “ute tax” was a major factor in kicking off last July’s Groundswell protest.
Federated Farmers told the Committee that electric, hybrid and low-emission model vehicles were not capable of performing the role of a farm ‘workhorse’.
“Farm vehicles require four-wheel-drive capability, the ability to safely carry heavy loads, towing capacity, long-range travel, off-road capability in wet and muddy conditions, hill descent, ability to maintain torque, and flat deck provision,” their submission said.
“Until such time as low emission vehicles can meet these requirements, Federated Farmers cannot support a clean car standard which includes farm utes.”
Isuzu Utes NZ CEO Sam Waller said the current targets were too tough and were trying to drive the New Zealand market to reduce too quickly.
“Failure will mean an effective increase in tax on new vehicles, which will reduce vehicle turnover and push out proposed improvements even further, and lead to the demise of Isuzu Utes New Zealand,” he said.
“Abandon the targets.
“It is our opinion that we are unable to meet the targets set out in the bill.
“There are no significant technology changes coming to the market in the near term to deliver the emissions reductions targeted.
“They go too far, and they go too fast.
“Do not take this as unwillingness – it is a genuine inability to source suitable vehicles within the timeframe.
The Motor Industry Association suggested to the Committee that the current targets be pushed out by two years.
David Crawford, the Association’s CEO, said the New Zealand vehicle market was tiny; on average, New Zealand imported around 0.17% of new vehicles produced in the world in any one year.
“There is a worldwide scramble for low emission vehicles which will continue to the middle of the next decade,” he said.
“Large markets get priority. Demand is particularly strong in left-hand-drive markets meaning product development resources are going there first.”
Over 80 per cent of new vehicles arriving in New Zealand were manufactured to meet the Australian Design Rules (ADR) and Australian market preferences, he said.
“The targets in the Bill are the most aggressive anywhere in the world and are unreasonable because they seek to get ahead of major automotive markets and fail to acknowledge our link to the Australian market,” the submission said.
“Acknowledging we are starting from behind the rest of the OECD, the rate at which we catch up is important.
“Too fast, and the costs become significant.
“Neither is it possible to get ahead of the major markets such as Europe, Japan and the USA without forcing absorbent costs onto the sector and consumers.”
But the car companies risk looking like dinosaurs alongside the new EV manufacturers.
The Ford Motor Company, long a symbol of United States industrial strength, is currently worth $US 108.66 billion, but Tesla, the EV pioneer, is worth $US1 trillion.
And Tesla came in right behind the Government emission proposals yesterday.
“Tesla’s position is that the proposed targets are very modest and very reasonable in an international context,” said Sam McLean, Senior Manager, Policy for Tesla in New Zealand.
“We’ve heard from previous submitters that this is the most ambitious scheme in the world, and I don’t think that bears examination.
“These targets would put New Zealand in the middle of the pack of comparable countries and are less ambitious overall than targets pursued by other countries, such as the UK which has a combustion engine vehicle ban by 2030 slated.”
But inevitably, the Select Committee came back to utes, albeit from a somewhat unlikely source, Helen White, an Auckland Labour list MP and former candidate for the non-ute driving Auckland Central electorate.
“When we will see things equivalent to utes turn up in our market?” she asked.
There was a long silence as the two Tesla executives looked a little taken aback by the sudden turn the Committee was taking away from high-flying environmental rhetoric.
Eventually, McLean said: “So Tesla is developing a Cybertruck, which is a pickup, a large ute, I suppose you could say, in production.
“We can’t speculate on when that could be introduced to the New Zealand market.
“There’ll be a lot of factors, including what policies are in place. But I would note that the clean car standards are not just about electric vehicles; they’re about cleaner and more efficient combustion engine vehicles as well.
“And there will certainly be increasing numbers of more efficient and more cost-effective vehicles available in those classes.”
In short, there could be a long wait for a Tesla farm ute.