Australian government and major business buyers must lead the charge by partially transitioning their vehicle fleets to electric cars, according to local Hyundai future mobility manager Scott Nargar, thereby speeding up the technology’s maturation here.
Given Hyundai now has two full electric vehicles on sale, the Ioniq and Kona Electric, plus a plug-in hybrid, it’s in a position to capitalise on market growth and therefore is at the leading edge of negotiations with peak bodies like the EV Council, and the private and public sector alike.
The thinking goes like this: big private and public fleet owners create demand and foster a market, which incentivises the private sector to make public charging infrastructure available, particularly given energy providers that fuel service stations are all investing heavily in green power right now.
With big fleets (with big budgets and often working to energy reduction targets) doing the heavy lifting, they also familiarise and normalise the tech to the wider public, create a market for used EVs to lower the entry barriers at the end of their leases, and indirectly drive down prices by increasing production scale.
“You look at government fleets around Australia, they have the biggest fleets in the country,” Nargar said.
“So if we want infrastructure to be put in – and the best way for that to happen is, as we’ve seen here in SA with the State Government and City of Adelaide putting infrastructure throughout the city and countryside – then those guys starting to transition their fleets is the best way.
“And it also helps encourage manufacturers to bring cars in. We’re a hard market, we’re right-hand drive, we’ve got few EVs here, we haven't got a whole lot of infrastructure and no incentives, so what’s going to help grow the industry is that fleet area. That will encourage the take up.
“... After a company has installed LED lighting and solar, the next best way to meet set emissions reduction goals is to improve transport emissions.”
This is a different approach to the familiar call from industry for European- and Asian market-style direct public incentives which, while still very much wanted by most OEMs here, seem unlikely to be made available. That said, we are seeing an increased role from various state governments.
For example, the ACT government will lease only electric vehicles from 2021 following on from its commitment to using 100 per cent renewable energy by 2020, Queensland is backing an Electric Super Highway of public rapid chargers, and The Senate Select Committee on Electric Vehicles has called for a firm national electric vehicle sales target.
Australia’s EV market penetration is a mere fraction of one per cent, which is a long way behind heavily incentivised markets like Norway, which has redirected profits it makes from fossil fuel creation into EVs via a sovereign fund.
The overarching issue is the need for a federal emissions target encompassing a CO2 emissions target, lower sulphur fuels and more.
“A shake up is good, having a target is good, knowing what to work towards for the next 10 years,” Nargar said. “[Though] from a Hyundai perspective we aren’t waiting on emission regulations, we’re going ahead and bringing vehicles in, the two EVs, the (hydrogen fuel-cell) Nexo and others that we can’t yet discuss.
“You’re not going to meet future emissions regulations just with hybrids…” he added.
By the end of 2019, there will be 12 EVs on sale: the Renault Zoe, Hyundai Ioniq, Nissan Leaf, Renault Kangoo Z.E, Hyundai Kona Electric, BMW i3, Tesla Model 3, Jaguar I-Pace, Tesla Model S, Mercedes EQC, Audi e-tron quattro and Tesla Model X. In early 2020, the Porsche Taycan and Kia Niro are expected to join, and VW’s I.D isn’t that far off.
This group will be priced between $45,000 and $200,000-plus, with driving ranges between 200km and about 550km.
With the cost impediments of EVs still abundantly clear in entry models like the $50,000 Nissan Leaf – each kWh of usable battery power adds around $200 to $250 to the cost, meaning a battery pack costs anywhere between $6000 and $20,000 – it's vital that luxury brands lead the charge, alongside the likes of Hyundai and Nissan.
“We welcome other manufacturers,” Nargar added, in the spirit Tesla showed when releasing its patents. “Competition is great, we need more EVs in the country to make it common place, and companies won’t invest in national infrastructure until there are more on the ground.”