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Clean Car Package Welcomed But Could Be Strengthened

The Motor Trade Association (MTA) has welcomed the clean car discount package announced today, but says the Government missed an opportunity to go further.

“We do welcome today’s news, as we have called for support on the demand side for a long time,” says Greig Epps, MTA’s Advocacy and Strategy Manager.

“We’re delighted the Government has considered the safety aspect, by setting a minimum 3-star rating.

“We do believe there are still opportunities to strengthen the package further though. This can be done by making the rebate process easier for consumers, increasing the size of the rebate and focussing on carbon reduction rather than just electrification,” he said.

Mr Epps said the proposed rebate process will still require vehicle purchasers to have enough cash or take a loan to purchase a vehicle first and only then apply for the rebate.

“This could still be a hurdle for the average Kiwi family,” he said.

“While dealers will be happy to help with making applications, perhaps the Government could look at allowing the buyer to access the funds at the time of purchase. Or is it possible for the dealer to access the funds on behalf of the buyer?”

The MTA believes the size of the rebate may not be sufficient to stimulate demand to the level the Government wanted. In comparison to other countries, the level of rebate is proportionately far less.

“New EVs start at about $48,000 and average about $68,000k. Whereas, you can get a really good new petrol car for under $30,000. The rebate only covers some of that gap.

“We think the Government may need to reach a bit deeper into its pockets if it’s expecting Kiwi families to reach into theirs.”

Mr Epps said the scheme could lower carbon emissions more if the rebate scheme had included hybrid vehicles.

“In its final report, the Climate Change Commission acknowledged that hybrids will need to be a transition vehicle.

“If we think about it in terms of available supply, there are fewer than 200,000 EVs in Japan, compared with millions of hybrids. So it’s disappointing the Government wasn’t willing to extend the rebate to hybrids as well.”

Mr Epps noted that today’s announcement continued to focus on what is being brought into the country, but not what is currently on our roads.

“There remains the unanswered question of what we do with the existing fleet of 5.5 million vehicles,” he said.

“We need people to be thinking about how they keep their current vehicle running clean through regular servicing and the Government to be looking at introducing emissions testing.”

It will become increasingly unattractive for motor vehicle dealers to take trade-ins of cars that are no longer desirable, he said.

“So where do people go to remove their car from the fleet? More than ever this country needs a comprehensive motor vehicle scrappage strategy.”

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