Government Crack Down on Petrol and Diesel Cars

If you enjoy your petrol or diesel car, the government is trying to make sure you won’t be enjoying it for long.

Looking through this word salad I got from the Department, the reality is the government is placing fines on manufacturers who sell too many petrol and diesel cars. Australians prefer cars that are useful for a weekend of camping, spacious enough to fit the whole family, and capable of doing long road trips without frequent refuelling or needing to stop to recharge.

The government thinks you’re enjoying your cars too much and is going to forces manufacturers to progressively phase them out, leaving only useless electric vehicles available.

Transcript

Senator ROBERTS: Can I turn to cars and utes, as mentioned by Senator O’Sullivan. Car makers must comply with regulations that you are about to introduce. They must also comply with customers’ needs. My understanding is that the demand for sedans—for example, a Toyota Corolla or a Honda Civic—is decreasing, and the demand for the corresponding SUV—which in the case of Toyota would be a RAV4 or a Honda Civic—is increasing dramatically. The SUVs are heavier, they’re more utilitarian, but they’re preferred. But they chew more fuel and they produce more carbon dioxide—which to me is not a problem, but anyway. How does that affect the manufacturer? On the one hand they have a government that says, ‘Decrease the size of the car, the weight and the fuel efficiency.’ But customers say, ‘No, do the opposite.’ The customers don’t think in terms of carbon dioxide because they know it’s crap.  

Ms Purvis-Smith: As I mentioned in a previous answer, manufacturers are able to make commercial decisions as to what their fleet looks like. The standard looks at their whole fleet. There are a range of ways that manufacturers can meet the standard. I think Mr Kathage went through this before. I’m not sure if you were here. He could go through that again. If they get credits in one year they can hold them over to meet debits they may get in a following year. They can also trade credits. They can look at the fleet, change the fleet and make commercial decisions about what they import into the country and offer consumers.  

Senator ROBERTS: Before Mr Kathage does that, perhaps you could tell me: if customers want SUVs over sedans, will that company be penalised? 

Mr Kathage: I can point you to appendix A of our impact analysis, where we set out the sales volumes of various types of vehicles. Your question is actually quite difficult because, as Ms Purvis-Smith mentioned, there’s actually quite a lot of things that vehicle suppliers can do to improve the efficiency of the vehicles they sell and their fleet overall. The first thing I’ll mention is that there are changes to the vehicles themselves that they can make—improving the aerodynamics, changing the drive train— 

Senator ROBERTS: I accept that. But an SUV compared to a sedan—they can make improvements on both but the SUV will chew more fuel and is heavier—full stop, end of story.  

Mr Kathage: That’s right. So one of the features of the policy is to include a few flexibility mechanisms. The first one is to include two targets. One target is for passenger vehicles and a higher target for light commercial vehicles. The second flexibility mechanism in the scheme is to adjust the limit by weight. So you might have a Toyota Kluger, for example, which will have a particular mass in running order. Therefore, the target for that vehicle or the fleet of vehicles—that weight—will be adjusted. The third thing is that in any given year a vehicle supplier might bring in too many vehicles that are too polluting. They’ve got two years after that point to bring what’s called their ‘initial emissions value’ down to zero. So they do have some time. 

Senator ROBERTS: Thank you. Looking at electric vehicles, for example, this policy, these regulations, are to make petrol and diesel vehicles less attractive and to make electric vehicles more attractive. That’s clearly what’s going on. But the efficiency of resources in electric vehicles is quite low, because the vehicles are inherently heavier, as Senator O’Sullivan said—needing heavier brakes, more resources; heavier suspension, more resources; heavier components all through, more resources. So we’re actually driving an economy to use less efficient vehicles and less efficient use of resources. That doesn’t make sense to me.  

Mr Kathage: I’m sorry; what was the question? 

Senator ROBERTS: The question is: are you aware that that’s happening? 

Mr Kathage: I’d probably say the purpose of the new vehicle efficiency standard is to improve the efficiency of new vehicles. It’s not to drive a particular type of vehicle or particular type of outcome, except for reduced emissions. That’s the purpose of the policy.  

Senator ROBERTS: You talked about reducing emissions. Have you done any work on the life cycle production of carbon dioxide from a diesel and a petrol vehicle, compared to the electric vehicle— 

Mr Kathage: We have— 

Senator ROBERTS: Particularly right through the mining sector as well, because there are extra resources that need to be mined for an EV. 

Mr Kathage: Yes, we have. We included some evidence in our impact analysis, which is now published on the Office of Impact Analysis website. Section 4.2.1 sets out a range of different estimates that have been made. The first one is from our own Bureau of Infrastructure and Transport Research Economics, which finds that while manufacturing an EV may produce more GHG emissions than an internal combustion engine, that is more than offset after about one year if the vehicle is charged from renewably sourced electricity—that is, home solar—and two years if charged from the grid using a mix of electricity generation sources. In that section—I won’t read it all out—we do have, I think, four other sources that support the same contention.  

Senator ROBERTS: There’s an assumption there that they’ll be using renewables—solar and wind. That’s a big assumption. Thank you, Chair.