Hyundai Kona 2019
Hyundai Kona 2019

The auto market in Australia, like overseas, is continuing to face tough times but one sector of the industry – zero and low emissions vehicles – is flourishing.

With an influx of new all-electric vehicles (EVs) and plug-in electric vehicles (PHEVs) becoming available in Australia, there is more choice for drivers buying new cars and it would seem that this, along with a desire to escape from rising fuel prices, is driving a change in the local automotive market.

New figures released by the Federal Chamber of Automotive Industries on Monday show that car sales to the end of July 2019 are 7.7% down from the previous year, a trend that is slowing but still persisten.

However, sales of plug-in electric vehicles have doubled to 1,572 sold from January to July in 2019 compared to just 762 in 2018 for the same period. Hybrid sales, led by the popular Toyota RAV4, have also surged.

While Australia’s love affair with big, grunty utes continues (the Toyota Hilux took the top position again in July), and SUVs remain the most popular segment overall, diesel sales have fallen across all markets by nearly 10%, dropping by 37% in passenger vehicle sales and 15% in the SUV segment.

Petrol sales have not suffered quite as badly as diesel but also continue to fall (the only exception being sales of private light commercial vehicles).

“The July sales figures continue to illustrate the tough market conditions facing the Australian automotive industry, and the sensitive nature of the economy over the past twelve months,” said FCAI chief Tony Webber in a note via email.

“Tight financial lending, drought, increasing Luxury Car Tax imposts and the Federal election have all contributed to make the Australian car market one of the toughest in the world.”

The automotive industry is reluctant to admit that many potential buyers may be holding on to their current vehicles for longer, waiting for an EV to arrive at their price-point.

In the SUV segment, where diesel sales have fallen by just over 18%, private sales of all-electric and plug-in electric vehicles have already soared by almost five-fold, and doubled for non-private sales.

Sales of plug-in electric vehicles (both battery electric and hybrid) in the private sector have also increased by 19%.

July and YTD sales by fuel type. Source: FCAI
July and YTD sales by fuel type. Source: FCAI

Although still accounting for a fraction of the overall auto market in Australia, the figures – and reports such as that from Toyota which was stunned when its RAV4 hybrid outstripped its fossil-fuelled stablemates by two to one earlier this year – show there is a change in the wind.

The figures do not tell the whole story, either.

Electric carmaker Tesla, which is famously tight-lipped about its vehicle sales in particular markets and does not share data with the FCAI, is not included in the above graph.

While until recently only its premium Model S sedan and Model X SUV have been available in Australia, with modest sales given the number of EVs registered in Australia is still in the low thousands, Tesla is just weeks away from commencing deliveries of its more affordable “mass-market” Model 3 to its first customers.

The Model 3’s arrival in Australia will further boost electric car sales, although not in the SUV segment – Tesla mass-market contribution to that segment, the Model Y, is not expected to arrive in Australia until 2021 at the earliest.

But there are already a few of plug-in electric SUV choices in Australia, notably the Hyundai Kona EV, the Jaguar i-Pace EV and the Mitsubishi Outlander PHEV, and it is these that are fuelling the push of EVs into Australia.

Other electric SUVs set to enter the Australian market in coming months include the Audi e-tron (that has just been released in New Zealand), and the Mercedes EQC.

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