Car industry Electric Vehicles | News

By MATT BROGAN

RECENT pricing forecasts from automotive data agency Blue Flag suggest the average Australian household income falls well short of that required to purchase a new electric vehicle.

The Melbourne-based company says its data was compiled based on communication with a range of companies from government agencies to international and leading automotive brands.

By 2025, Blue Flag estimates that of the 133 new electric car model ranges expected to enter the Australian market, 22 will be priced above $150,000, 24 between $100,000 and $150,000, and 20 in the $80,000 to $100,000 range.

It says most new battery electric vehicle (BEV) models due to go on sale before the middle of the decade will be priced within the $60,000 to $80,000 range (47), with 19 models to be offered in the $40,000 to $60,000 bracket, and just one below $40,000.

The current average annual salary of an Australian adult working full-time is listed at $86,246 (before tax) according to the Australian Bureau of Statistics.

According to Blue Flag’s transactional data, the majority of new car sales in Australia are of models priced between $20,000 and $60,000, with around 39 per cent of the total being in the $20,000 to $40,000 bracket and a third being in the $40,000 to $60,000 bracket.

Currently, Glass’s Guide figures show a combination of internal combustion, petrol-electric hybrid and plug-in hybrid models favoring the $40,000 to $60,000 retail bracket (111) ahead of the $20,000 to $40,000 segment with 97 new models on offer.

There are seven new vehicle models currently available for less than $20,000 before on-road costs.

Further, there are 88 new vehicle models priced in the $60,000 to $80,000 range, 57 in the $80,000 to $100,000 price bracket, 62 in the $100,000 to $150,000 set and 84 priced at $150,000 and above.

These numbers will diminish over time as an increasing percentage of importers move to offer new energy vehicles. Most indicate they will phase out the development of internal combustion engine (ICE) powered models entirely by the end of the decade or earlier.

Number of new BEV model ranges in Australian market*:

retail price

Current

End ’22

End ’23

End ’24

End ’25

<$20k

$20k – $40k

1

1

1

$40k – $60k

5

6

13

16

19

$60k – $80k

eleven

fifteen

29

36

47

$80k – $100k

3

8

12

twenty

$100k – $150k

6

10

13

twenty

24

<$150k

6

6

10

fifteen

22

*Data supplied by Blue Flag and Glass’s Guide.

Number of new ICE/PHEV/Hybrid model ranges in Australian market*:

retail price

Current

<$20k

7

$20k – $40k

97

$40k – $60k

111

$60k – $80k

88

$80k – $100k

57

$100k – $150k

62

<$150k

84

*Data supplied by Blue Flag and Glass’s Guide.

Speaking to GoAuto this week, Blue Flag director and co-founder Matthew Farrell said that although the figures show a skew towards higher priced EVs, there are a number of factors that may alter the average price paid for a new electric vehicle between now and the middle of the decade.

“One of the reasons the data is skewed this way falls largely to the fact that premium brands confirm their new-model outlook further ahead than many of the mainstream brands,” Mr Farrell told GoAuto.

“But what we know we will see in the next three- to five years is the accelerated growth of some more affordable models, particularly from China, that will come on stream within that time frame.

“Before then, the continuation of ICE cars will mean the total industry volume should stay close to where it is currently. The percentage of EVs within that million sales figure is becoming greater, but I think the days of really affordable cars, say those below the $20,000 mark, are potentially a thing of the past.

“Our data shows that this segment is largely a thing of the past anyway. The transactional data we have shows that the highest percentage of new car sales falls in the $20,000 to $40,000 price point at around 39 per cent, and in the $40,000 to $60,000 bracket it’s around 33 per cent.

“So, we think that is a really good indicator as to where ‘affordable’ EVs need to make an entrance to be adopted by the majority of new car buyers.”

Mr Farrell said state governments have introduced incentives aimed at driving the take up of battery electric vehicles, however there is a disparity between what each of the states and territories offer new EV buyers.

“The total incentive for a $50,000 EV that is driven an average of 10,000km per year over a three-year period varies from $1,773 in Northern Territory and up to $5,055 in South Australia.

“We also need to consider the approach the ACT is taking. The CO2 mandate there – how it applies within different bands and the size of the vehicle – is something that could have a considerable impact on what kinds of new cars we buy were it to be adopted nationally.”

As states and territories including the ACT announce that they will phase out the sale of internal combustion powered models within by 2035, the potential for a class divide between thermal and electric powered vehicles is one that will create not only social division, but an aging and higher polluting car park that would likely deny any changes made by a switch to electric cars.

Without significant changes to governmental support of new EV purchases – and with electricity prices expected to soar in the new calendar year – it is feared many Australian motorists will be left with little option but to continue driving older, conventionally powered models.

2022 YTD new passenger, SUV and LCV sales by fuel type*:

Fuel type

units sold

Diesel

214,517

electricity

10,289

Hybrid

47,835

hydrogen

10

oil

320,127

PHEV

3519

*Data supplied by FCAI.

The issue has the potential to add to the average age of Australia’s vehicle fleet which at 10.1 years is already the oldest – and most heavily polluting – of any Western country on a per capita basis.

It is also likely that the lending criteria of banks favoring loans of new energy vehicles will further disadvantage Australian families with below-average wages.

Not only will these motorists be forced to continue to maintain older, higher polluting vehicles, they will also be deprived of the latest safety and drive assistance technology which will gradually be phased out of development of ICE powered cars.

The news comes as a double blow to motorists already faced with ballooning living costs and record transport costs.

Earlier this month, Australia’s peak motoring body, the Australian Automobile Association (AAA) said September is shaping up as a watershed month for cost-of-living pressures in Australia as the temporary cut to the fuel excise comes to an end.

Petrol prices are expected to return to more than $2 per liter this month, the AAA’s quarterly Transport Affordability Index showing a typical Australian household spends more than $100 on fuel each week ($100.54/week).

Average weekly cost of fuel per family in capital cities:

fuel cost

quarterly difference

Adelaide

$95.28

(+$4.69)

Brisbane

$98.15

(+$4.22)

Canberra

$98.92

(+$6.03)

Darwin

$99.84

(+$5.48)

Hobart

$102.63

(+$2.45)

melbourne

$97.29

(+$5.22)

Perth

$95.71

(+$3.56)

sydney

$99.13

(+$4.33)

*Data supplied by Australian Automobile Association.

Average weekly cost of fuel per family in regional cities:

fuel cost

quarterly difference

Alice Springs

$109.27

(+$8.32)

Bunbury

$122.70

(+$6.39)

gelong

$118.31

(+$7.62)

Launceston

$114.67

(+$5.30)

Mount Gambier

$108.24

(+$6.84)

Townsville

$78.04

(+$3.67)

Wagga Wagga

$67.73

(+$4.27)

*Data supplied by Australian Automobile Association.

These costs, coupled with rising registration and insurance fees now place the average weekly cost of vehicle ownership in Australia’s capital cities at a record high of $412.21.

Nationally, transport costs represent 15.2 per cent of household income.

“Despite the temporary excise cut, fuel prices are rising and continue to be a significant contributor to cost of living pressures across both regional and metropolitan Australia,” said AAA managing director Michael Bradley.

“This is the first time the national weekly average spent on fuel has passed $100 since the index’s inception in 2016.

After declining in the previous quarter, car loan repayments have risen again due to higher vehicle prices and higher interest rates on loans.

In the June quarter, the typical Australian city household’s average annualized cost of transport increased by $581 to $21,435.

Transport taxes – in the form of fuel excise, registration, compulsory third party (CTP) insurance and licensing – cost the typical two-car family $2,154 annually, reflecting the $581 decrease in fuel excise costs arising from the temporary cut.

Toll road charges are also set to rise in line with standard indexing from April 1 (2023).

Average weekly transport cost per family in capital cities*:

transport cost

quarterly difference

Adelaide

$383.01

(+$11.86)

Brisbane

$454.51

(+$8.82)

Canberra

$393.59

(+$12.00)

Darwin

$377.83

(+$17.11)

Hobart

$361.12

(+$6.67)

melbourne

$461.01

(+$13.18)

Perth

$380.42

(+$7.90)

sydney

$486.18

(+$11.74)

*Data supplied by the Australian Automobile Association.

Average weekly transport cost per family in regional cities*:

transport cost

quarterly difference

Alice Springs

$370.59

(+$20.14)

Bunbury

$362.84

(+$10.78)

gelong

$361.55

(+$13.85)

Launceston

$335.36

(+$9.45)

Mount Gambier

$344.80

(+$13.64)

Townsville

$318.19

(+$8.22)

Wagga Wagga

$307.55

(+$10.07)

*Data supplied by the Australian Automobile Association.

.