Is the EV Revolution Here or Are Petrol Cars Still a Better Bet Than Electric Cars?
Date Posted: 13 August 2022
Electric cars are fast becoming a common sight on Australia’s roads. In fact, sales of EVs in Australia tripled in 2021. This is expected to continue through 2022 due to rising fuel prices and concerns about climate change. State government incentives have also played a role in convincing more Aussies to ditch petrol power.
But electric car sales only make up around 2% of annual car sales — a worrying number given when Australia sells more than a million cars a year. So, is now really the time to get an electric car?
Australia on the Road: Are We Petrol Powered or Living the EV Life?
While EV sales may have tripled recently, Australia is far behind the rest of the world. For instance, while there’s more than 6.5 million electric cars on roads across the world, a staggering more than 5 million can be found in China. While this only accounts for roughly 1.5% of China’s vehicles on the road, it’s worth noting that from 2020–2021 China’s EV sales went from 1.3 million to 3.3 million.
The uptake is certainly far more present overseas than here. This is particularly evident looking towards Europe, where more than 11% of Norway’s traffic consists of electric vehicles. Figures from 2020 even show that close to 75% of all vehicles sold in Norway were electric.
So, what is stopping Australia's EV ownership from reaching international levels?
Are Electric Cars a Likely Option for Australia?
The Australian EV market has been slowly growing, with clear favourites becoming clear. For instance, in 2021, Tesla Model 3s accounted for more than half the EVs sold in the country. But, Tesla is definitely not the only option available.
In fact, there are now more than 30 options for interested consumers to choose from. Plus, this number is expected to be closer to 60 come the end of 2022. However, if you were hoping to see family favourites and long-time Aussie staples, like Holden or Ford, on the list, you’ll be sorely disappointed. The majority of EV options are for premium or luxury companies, like BMW’s i4 or iX electric cars and the Mercedes-Benz EQC. While we'd all love to save the environment in style, it’s not always a viable option.
The cheapest electric car currently on offer is the MG ZS EV Excite at $46,990. So, you can start to see how many Australians are still being priced out of the EV market. Even reliable lower-priced companies' electric cars, like Kia, start at the $60,000-plus mark. When it comes to small cars, we tend to spend on average around $26,150, with sedans and SUVs going up to $44,557. While this is close to the Excite’s price tag, when you break the data down to a state-by-state level, the picture becomes clearer. You'll see the majority of Australians only spend, on average, below $41,000 for a new car.
Of course, having the cash to buy your EV isn’t enough. There also needs to be one available for you. The Electric Vehicle Council cites a poor demand to supply ratio as a significant factor for Australia’s EV sales being so much lower than the rest of the world's. For instance, while the Tesla Model 3 may have been the most popular EV by far in 2021, you can expect to wait 6–9 months to actually get your hands on one. At the lower end of the range, if you’re after an MG ZS EV, you can only register your interest at this time. The updated range is only arriving some time in the later half of the year.
Price and demand outstripping supplies aren’t the only factors making the nation really consider “Should I buy a petrol car or wait for an electric one?”. It’s the existing infrastructure too.
At a policy-level, Australia’s State and Federal Governments have done little to incentivise ordinary Australians to make that jump to a more expensive car or to reduce that initial pain to the hip pocket. The Electric Vehicle Council details how the Federal Government has not used the proposed $250 million in funding for EVs to provide any financial incentives that immediately reduce the cost of purchasing an electric car.
There also aren't even really any policies to increases savings throughout the vehicle’s lifetime. Although State and Territory Governments vary in their approaches, many do offer some form of incentive in the form of cost savings for purchasing and driving an EV. However, these aren’t dramatically changing the EV landscape either.
When looking at day-to-day operations, consumers also have hurdles to overcome. In fact, 92% of consumers feel an adequate fast charging infrastructure is important for growing the electric vehicle market in Australia. Over the last 2 years, we’ve seen more than 100 additional public fast charging locations come into action. However, these are not always evenly distributed, with a fair majority in NSW.
Given the ACT has been adopting EV technology at twice the rate of NSW, it’s concerning then that NSW has 31% of Australia’s public fast chargers, while the ACT has less than 2%. Even taking into consideration that NSW has 90% more registered electric vehicles than the ACT, this is still worrying. While these figures don't account for multiple chargers at the same location, worries around charging on the go are a likely factor for buyer hesitancy.
Similarly, the NSW Government has committed to a further 250 fast-charging locations — aiming for one every 100km of regional routes and every 5 km for residential areas with limited off-street parking and major commuter corridors in Sydney. In comparison, the ACT has only committed to 20 more fast chargers to be installed. This is a story repeated across the country, with limited fast chargers available for the public and clustered in certain areas.
Therefore, at present, if you embarked on a nationwide trip, or even a long drive, there’s not always a guarantee you’ll be able to find a charger, fast or otherwise. This tracks with research suggesting 67% of surveyed Australians feel access to on-road charging is a barrier to switching to an EV.
Right Now, Are Electric Cars Worth It?
While you’d be better off buying an electric car in 2022, compared to 10 years ago, are electric cars cheaper to run now?
While the initial outlay for an EV can be an issue for many Australians, there certainly are savings that can be made in the long-term in regards to operation and maintenance of your electric car. Depending on how far you drive each year, you’re likely to see savings of 10 cents per kilometre for fuel or power if you move to an EV. You may be saving more though if you have access to free charging or have renewable energy options for home charging.
However, if you’re a Victorian, you’ll be saving closer to 7.5 cents, given the proposed road tax for zero-emission vehicles (operating at 2.5 cents per kilometre). Regardless, with fluctuations and general increases to petrol prices, this difference certainly has the capacity to get more enticing. From a maintenance perspective, the simplicity of an electric vehicle’s inner workings also reduces the regularity and complexity of servicing.
For the average Australian petrol car, every kilometre driven costs roughly 7 cents in maintenance costs, compared to only 2 cents for EVs. In regards to useful life, electric vehicles and petrol cars are roughly equal. Current lithium-ion technology has your EV’s battery lasting for around 10–20 years. This is on par with the expected average operating age of petrol cars in Australia (approximately 14 years). Therefore, concerns around having to more frequently purchase a new vehicle after switching to electric are not necessarily warranted.
So, Should You Buy an Electric Car Today?
No one’s arguing if electric cars are the future — it’s a matter of if now’s the time to make the switch. In our professional opinion, as an automotive spare parts shop and with more than 20 years in the automotive industry, the time isn’t quite yet right for Australia. Access to affordable options — and even supply in general — is limited. Similarly, the current infrastructure does not wholly support or promote every Australian making this change, regardless of driving lifestyle.
However, this doesn’t mean that things won’t change soon. Increased demand for climate action and alternatives to increasing petrol prices are huge factors. Australia cannot lag behind our international counterparts for much longer. Therefore, now might be the time to start saving and looking at the international EV market. Just hold off on getting that Tesla yet.