How and why to increase the uptake of electric cars in New Zealand

Greatly increasing the uptake of electric vehicles in New Zealand would have many benefits. Presumably, this is not news to any New Zealand MP. Below is a catalogue of at least some of these benefits.

I understand from talking to people in the electric car industry that the government is willing to spend quite a few millions to work out the best way to encourage EV uptake. Save the money. It’s not rocket science.

The main barrier to electric car uptake is cost. The government is in control of a significant portion of the cost of an electric vehicle. 

 

What to do

 

First make sure that there are no import taxes, stamp taxes or any other taxes related to the import of electric vehicles. 

 

Remove GST from the purchase of electric cars. This move, at one stroke of the pen, with no cost to the exchequer, reduces the price of a vehicle by 15%.

 

Then announce that there will be no road taxes for 20 years from the first purchase of a vehicle in New Zealand.  

 

And yes, an electric car can last for 20 years.  I have just learned that the battery of a Leaf, for instance, can be swapped out in an hour and the 24kWh batteries in earlier models can be swapped for a 30 or 40kWh battery.  Apparently, with a couple of simple modifications even the new 60kWh battery can be fitted into older cars.  Add to that, that batteries are continually coming down in price and an electric car becomes a very attractive proposition.

 

Eliminate the FBT (Fringe Benefit Tax) for electric vehicles.  This is the tax that companies and the employee pay for the ability to use the company vehicle, privately.  Not only does this tax cost the users of the car money but it is a real pain to administer for both employee and employer.

 

With no FBC, a lot more people would experience their first use of an electric vehicle.  In addition a lot more second hand electric vehicles would come on the market.  

 

And, Yes, I'm sorry but you can't be fair to everyone.  ICE car dealers will scream bloody blue murder but you have to decide if we are really serious about accelerating the transition here in New Zealand. Every serious move we make to reduce our emissions will have some negative effects for some sector of the economy.

Benefits of Electric Car Uptake for New Zealand.

*Reduction of the health costs, caused at present, by ICE vehicle air pollution.

 

*Reduced road repair costs. Oil leaks degrade asphalt.

 

*Reduced costs under Koyota to New Zealand as our C output declines

 

*Added revenue to producers of renewable energy with the increased market for their electricity. Since charging, logically,  will be on a demand basis, much of the car charging will be done when excess power is available.  In other words, less need to feather wind turbines when power is in excess of demand. There will be a market for the full capacity of our renewable energy.

 

*Improved balance of payments as we reduce our import of petroleum products.

 

*An addition to our green reputation which impacts on our exports.

 

*A large benefit to individual Kiwis. (which is the primary responsibility of any democratically elected government)

 

ICE car dealers will not be pleased if we tilt the playing field in favor of electric cars but we have to decide whether we are serious about reducing our carbon foot print and making New Zealand an even better place to live.  Every disruptive move we make will disadvantage some sector of the economy.  I suppose it is good that we don't have an ICE car manufacturing sector to protect.  That would make the government decision even more fraught.  ICE car dealers will soon pivot to selling electric cars. 

           Then we can think further outside of the box

New Zealand has achieved quite an enviable reputation in the world because of the way our Prime Minister and her party have handled two very difficult situations; namely the mosque shooting and Covid 19. Labor has also initiated many green pieces of legislation which will appeal to Elon Musk. Let’s parley that reputation into benefits for New Zealand.

Invite Tesla to set up a factory in New Zealand. The fact that we have made the uptake of electric cars more affordable will be another factor in our favor. Elon Musk is a visionary. He thinks outside the box. Present the case in the right way and he might just consider the proposal. So what are the arguments to present to him.

Positive Factors for Tesla

*New Zealand already has a high percent of it’s electricity produced renewably. Cars produced here would have a particularly low carbon foot print.

 

*TY point is going to close down leaving a great surplus of electricity.

 

*As seen at 'battery day', Elon is all for vertical integration. A lot of Aluminum is used in his cars. He could even take over the Al plant and enough of the Al smelter employees to run the factory and produce Al for his cars. The personnel is already in place and really don’t want to leave Invercargill.

 

*In the same way that we have handled this pandemic, we will handle the next one (and there will be a next one). This is especially so if Labor is in power. Disruption to production, caused by any future pandemic, will be minimal.

 

*TY point already has a dedicated deep water port for shipping in parts and materials and shipping out cars. Marine shipping is a very economical way of moving materials and goods around the globe.

 

*New Zealand is a very attractive place for anyone to work and play. His best people will jump at the chance to live and work in New Zealand: especially after the dismal situation we see in the US of A and to a lesser extent in the rest of the world.

 

*Cars produced here can have a “Made In New Zealand” label.

 

Positive Factors for Us

 

*No need to decrease the economic activity in Invercargill. In fact we would greatly increase it.

 

*Introduction of top level technical people into New Zealand. No knowing what spin offs will result as some of these folks become New Zealand citizens and take their talent to other sectors.

 

*Most likely, good car prices for the public for cars produced right here in New Zealand

 

*It is likely that Tesla will install a mega battery to smooth out her power supply. This would have a very positive effect on the frequency and voltage stability of the grid in Invercargill as has happened in the grid supplied by the Hornsdale Wind Farm in southern Australia.

 

*Tax revenue from workers in the factory and from all the secondary industries which are enabled.  It has been estimated often as reported on Radio New Zealand that for every primary job, 4 or more secondary jobs are created.  It is probably worth while to give a very favorable company tax regime to Tesla.  The ancillary benefits are great.

 

New Zealand has many advantages over other countries. We have seen what we can do in the food industry and film industry. Let’s show a little confidence in ourselves and ‘go for it’.