Sanjeev Gupta says electric cars will drop in price just like television. AAP
Sanjeev Gupta says electric cars will drop in price just like television. AAP

Chairman of mining and energy giant GFG Alliance Sanjeev Gupta is hatching a plan to create a niche electric car industry in Australia in collaboration with innovative UK automotive design company Gordon Murray Design.

Headed by former F1 designer Gordon Murray, the design company has been working closely with Gupta’s GFG for the past 18 months and the two companies have their eyes on Australia as a manufacturing base.

While uptake of electric vehicles in Australia has been extremely slow compared to other developed countries in part because of the higher upfront costs of purchase of EVs, Gupta believes this discrepancy in price won’t last, comparing the emerging automotive tech to that of large-screen televisions and solar panels.

Indeed, data from Bloomberg New Energy Finance is already suggesting that as soon as 2020, the total cost of ownership for EVs in Australia will be less than that of combustion vehicles.

Both Gupta’s comments and the BNEF data fly in the face of comments made by prime minister Scott Morrison during Sunday’s political debate in the lead up to this month’s federal election that (currently) an electric car can cost upwards of $20,000 extra compared to its combustion vehicle equivalent.

“All of these things start out at a particular price point and over time they get cheaper and cheaper,” Gupta told the AFR this week.

What kind of electric cars the joint venture will make is still up in the air, Gupta says, noting that one prototype being considered is a small-sized city car.

However, as Australians tend to preference much different types of vehicles (large utes and SUVs top the list often on Australian car sales figures), this may be a deciding factor.

“Australia may not be ready for a smart car. We are likely to have a range,” Mr Gupta said. “My dream would be to launch a people’s car.”

GFG Alliance last year purchased the Whyalla Steelworks, and has previously earmarked Victoria or South Australia as a suitable location to set up base.

Although Gupta declined to comment to the AFR on location, the GFG chair said last year at the Australian Energy Storage Conference in Adelaide that production could begin by 2020.

“We will definitely in the next two or three years have a car in production in Australia,” Gupta said.

Production runs would be small, from 10,000 to 20,000 units per model, with around 30,000 units made per year according to The New Daily, and using lightweight composite panels aims to sell the cars as cheaply as $A20,000-30,000.

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