New vehicle standard to drive significant change to Australias carpark

17.5.2024

The AAA is pleased to see Australia introduce a fuel efficiency standard for its new vehicle fleet, but disappointed by the lack of clarity on the consumer impacts of the Government’s preferred approach, and the lack of a bipartisan approach to this significant reform.

Australia’s peak motoring body is pleased to see Australia introduce a fuel efficiency standard for its new vehicle fleet, but disappointed by the lack of clarity on the consumer impacts of the Government’s preferred approach, and the lack of a bipartisan approach to this significant reform.

The AAA has for many years championed the introduction of a standard capable of ensuring Australian motorists can access a first world fleet and the cleanest and safest cars under production. The AAA has long accepted that such a standard will make the cost of some cars higher than it otherwise would have been – just as it will make others cheaper.

The degree to which the Government’s New Vehicle Efficiency Standard reduces transport emissions, improves consumer choice, or increases car prices will depend upon how the Government has balanced the standard’s ambition and achievability.

The AAA very much hopes the Government’s forecast improvements in fleet choice and transport affordability are realised, and encourages the release of detail to motorists on how the scheme negotiated with car makers and dealers will change price and availability for specific vehicle segments and models.

The AAA calls for a bipartisan approach to the various policies shaping the technological transition of Australia’s vehicle fleet.  Unnecessary partisan debate can only serve to hinder Australia’s ability to adopt new technology.

The Government is right to incentivise the uptake of new technologies and more fuel-efficient vehicles, but this ambition must be supported by a suite of policies and programs to drive behaviour change:

• Australia’s EV recharging network shortcomings are a major inhibitor to take-up. Significant private sector investment is needed, and the lack of long-term policy certainty is an ongoing disincentive.
• The increasing inequity of current motoring tax arrangements is another complex issue – this demands a bipartisan approach as the introduction the New Vehicle Efficiency Standard makes reform more urgent.

The AAA’s Real-World Testing Program enjoys bipartisan support. Funded by the Commonwealth, the Program will help ensure emissions reduction and fuel efficiency targets of the laboratory-based standards (including NVES) deliver real world benefits to motorists and the environment.  The AAA’s Transport Affordability Index shows Australian households are today paying $454.41 per week on transport costs: a figure currently rising at 10% per annum.

The AAA looks forward to working with both sides of politics to build the consensus needed to deliver long-term reforms that improve Australia’s access to emerging technology and transport affordability.