Sales of electric vehicles in Australia have jumped more than 400% since the middle of 2022 and have accounted for up to 9% of new car sales in recent months, suggesting that a tipping point has been reached, according to the head of the National Automotive Leasing and Salary Packaging Association (Nalspa).
Rohan Martin says a large part of the increase comes from innovated leasing and salary packaging providers thanks to recent government policy shifts.
Most importantly, however, is the possibility that Australia has finally reached a tipping point in the sale of electric vehicles that could rapidly accelerate.
“When you’re dealing with a once in 100-year technology change it’s extremely difficult to make accurate long-term forecasts,” said Martin.
“But what we understand from research and experience in other countries is that 5% of market penetration represents a critical tipping point, after which EV take up becomes much more rapid.
“Recent policy initiatives and improved availability of EVs have helped propel the market toward and beyond that crucial 5% mark, and it would be reasonable to expect take-up to continue to accelerate from there.
According to Martin, “changes legislated to novated leasing for electric vehicles in December 2022 through the EV FBT exemption allows everyday working Australians to achieve significant savings on the cost of an EV.
“That being said, like any change to taxation arrangements, awareness of this new policy will take time to filter through to employers and employees alike,” Martin added.
“But the experience of our members in the sector is that more and more everyday working Australians are recognising the benefit of this shift and are taking advantage.”
The NALSPA expects that further demand for low- and zero-emission vehicles will be driven by the launch of new electrified vehicles into the Australian market over the medium term.
And while numerous roadblocks remain – including consumer understanding of EVs, available charging infrastructure, and a lingering shortage of stock – the federal government’s national EV strategy and the proposed introduction of a balanced fuel efficiency standard will continue to wear down these barriers to entry.
Joshua S. Hill is a Melbourne-based journalist who has been writing about climate change, clean technology, and electric vehicles for over 15 years. He has been reporting on electric vehicles and clean technologies for Renew Economy and The Driven since 2012. His preferred mode of transport is his feet.