Mitsubishi Outlander PHEV. Image: Mitsubishi
Australia could remove a vital “stepping stone” in its transition to electric vehicles if tax breaks for some hybrid cars end next year, automotive groups say.
The warning comes amid a sales rush for plug-in hybrid electric cars, according to vehicle leasing company Smartgroup, and a survey showing three-in-five buyers nominated tax cuts as the top reason they purchased the low-emission vehicles.
But the Australian Tax Office has issued additional guidance to potential buyers confirming the deadline, and the independent senator who helped create the concessions says taxpayers should not keep subsiding “fossil fuel vehicles”.
Sales of new plug-in hybrid vehicles have more than doubled in Australia over the past year.
Smartgroup group executive Sid Jha said the vehicles now represented more than one in every 10 cars leased.
He said fringe benefits tax cuts on plug-in hybrids were fuelling the trend and consumers were rushing to sign commitments before they expired.
“There is a sense of urgency that we see because people are realising that the exemption is running out in April and they’re trying to get a vehicle,” Mr Jha said.
“People are not buying (electric vehicles), so they are looking at the next-best option, which is a hybrid model or a (plug-in hybrid).”
The tax exemption, which came into effect in late 2022, removed fringe benefits tax from some low and zero-emission vehicles purchased through novated leases.
The concession for plug-in hybrid cars is due to end in April, but will continue for battery electric vehicles.
A survey of more than 600 plug-in hybrid vehicle drivers, conducted by JWS Research for the National Automotive Leading and Salary Packing Association, found three in five named the tax cut as the leading reason they chose hybrid technology.
Almost two in three surveyed would also consider buying a plug-in hybrid for their next vehicle, and more than half said they would consider an electric car.
Association chief executive Rohan Martin said the results proved plug-in hybrid cars were acting as a “stepping stone” towards electric transport.
“What this data shows is that without the (tax) exemption, a whole lot of satisfied plug-in hybrid drivers would most likely still be driving less efficient, higher tailpipe emission cars,” he said.
“The FBT exemption makes it affordable and accessible for Australians to try a PHEV.”
Automotive firms including Mitsubishi and the Motor Trades Association also called for the tax cut to be extended for hybrid vehicles at recent Transition to Electric Vehicles inquiry hearings.
But independent senator David Pocock, who with the Greens negotiated to limit the hybrid vehicle tax break, told the ABC he did not support an extension.
“In a cost-of-living crisis where people are doing it tough and a climate emergency, taxpayers shouldn’t be subsidising fossil fuel vehicles,” he said.
“This is about genuinely transitioning away from fossil fuels.”
AAP
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Almost makes me want to move to Canberra just so I can vote for David Pocock at the next election. This is why we need to vote more independents in. The stale old parties are only guided by the lobby money.
Forget about that.
Just send him a bit further west to sort out the dog's breakfast as outlined by Giles' reneweconomy story on Broken Hill. The town that gave us BHP is living in a renewables nightmare.
It is a fossil fuel nightmare. Generators constantly failing.
They have massive resources. Rank stupidity won't allow them to access it.
Mine generators?
What a joke!
Renewables didn't fail. Diesel Generators did. Renewables didn't generate because they were forbidden to.
The other thing that failed was the big battery run by - you guessed it! - a fossil energy company that wasn't expecting to bring their battery in to support the grid, because they were expecting the Diesel Generators to be doing it.
Spot on David Pocock - hybrids have most of the downside of ICE vehicles with little upside.
......and they could undermine the remote area charging establishment.
As a hybrid owner of 8 years they really don't.
Please share more - model, proportion running in each mode, frequency of charging. Anecdotes ... How about maintenances costs? Fuel costs? What upside have you got?
But the most important question is what is your next car? Guessing that a good decision 8 years ago might not be the best now?
Correct Paul. Next car will be a BEV. But they remain unaffordable for me so hybrid will get run till it dies.
There is no stepping stone to an EV! I assume the rush to PHEVs is because they get the discount and are cheaper than an EV, not due to some altruistic principle.
They grease many palms
Except that in many cases, they are not cheaper than EVs.
Never assume. There are many good reasons for buying a PHEV as a stepping stone. The primary reason being: you get a city EV and a Long range car for road trips.
BYD are selling more PHEVs than BEVs in China.
Only agreed with BYD plugin hybrid with at least 100km of range. The engine is only purely to charge the battery on road trips and nothing else. All other hybrids especially Toyota are nonsense! Look at the costly repairs of the batteries on the German cars (BMW Hybrid).
https://x.com/evclinic/status/1849564972948357223?t=xU6im9lqATBmPH0XYfugrQ&s=01
Why not get an EV with 500kms of range then you wouldn't even need that extra FF burning motor at all? Look at the cost savings most EVs bring. Germans and Japanese have really dropped the ball regarding EV tech so they aren't good measuring sticks to use. The Chinese and Koreans did the smart thing, they copied Tesla's tech and now have become the spear head of the new transportation future.
The argument that PHEVs actually reduce CO2 emissions by having a relatively small battery and a seldom run ICE motor. The smaller battery is lighter and doesn't take as much power to lug around even when you are only using 10 or 20% of it on a daily basis.
Not much of an argument then.
Teslas can criss-cross continents no problem. All it takes is super charger investments which Tesla has been very accomplished at. That way you never need to pull into a stinking gas station ever again AND hardly any servicing either for a double savings whammy!
Agreed. Once chargers are literally ubiquitous there will be no need for a PHEV
A Tesla is not needed to "criss-cross continents".
In 2022, Steve Gill flew from Perth to Sydney to collect his BYD T3 van ( (WLTP ?) range 300km), and drove it from Sydney to Perth. See
https://bydt3campervan.wordpress.com/2022/03/12/sorry-for-the-delay/
Also,
https://thedriven.io/2022/03/24/sydney-to-perth-in-five-days-in-a-short-range-byd-t3-electric-van/
Our EV has been good for trips up to 4,000 kms or so, though we stayed in the NEM states.
And...because some people are just terrified of new tech period and at least PHEVs have tethers to what they already know rather a jump into the complete unknown. This is as much a FUD problem as anything. A little more acceptance though and people will just have those fears worn down. "Well Burt's got one and he seems okay".
I don't think that's the main reason. It's more simply a range anxiety issue.
Senator Pocock certainly knows how to gather enemies.
Old Media dependent on Old Dealerships and supported by Big Oil will send him the message PDQ. Brave man.
The media will 'find' some text message he wrote when he was 15 and sully his name.
What message could they send that would cause him either to change his logic or to scare him? Qlders can't vote for or against him him. He's probably the most physically impressive politician I've seen and played very successfully in a tough position in a physically tough sport at the highest level.
I prefer to think of it as he (an other enlightened leaders worldwide) are sending the Old dealerships and Big Oil a message. "Your time is running out".
It was hugely disappointing to see recent BYD sales figures with their PHEV sales skyrocketing and BEV sales plunging ☹️.
BYD should hang their head in shame for removing BEVs from prime position in their Brisbane showroom and instead putting PHEVs in front and centre showroom position. Do Better BYD ... you are part of the problem!
They are responding to the current market. That's what people want. Or rather, need, given the woeful state of charging stations and the limited BEV range.
So BEV utopia will have to wait a little bit longer.
"They are responding to the current market"
Are they really?
Or are they just flogging a dead horse? Putting lipstick on an old tart? Selling tickets to the farewell tour? Calling sleeping in your car glamping? Becoming amish? Inventing a four sided wheel?
The supposition that, without the FBT break, hybrid buyers would be driving dirtier vehicles is drawing a long bow.It is just as, if not more likely they would have bought a BEV since the tax break was the decider. Hybrids could have actually delayed the transition to BEVs.
The incentives need to be aligned with the outcomes we want, not what leasees prefer today. The arguments about the "infrastructure isn't there yet" are spurious and will be fully resolved before long. If people want to buy a PHEV, they can knock themselves out. Taxpayers should not be funding it.
Spot on! I wonder to what extent the sales surge of PHEVs is being driven by manufacturers. and dealerships, not by customers.
"If people want to buy a PHEV, they can knock themselves out."
I wish they would.
But seriously, the watering down of emission standards has caused this. Dutton spooked Albanese with 'they're coming for your utes!' A mad macks war cry.
Shocking lack of backbone on display there. Typical politician, of every denomination.
Well let's discuss this again in 12 months or so when results of the first few months of the changed rules come in. For the current models being leased, has anyone actually analysed the costs of the PHEV leases against BEVs? Probably not that important since the rules will be different and aren't changing back.
Toyota sad, bigly. 😭
Not really. They only sell HEVs and one BEV. They don't sell PHEVs in Australia, so this will not affect them.
It is good to see that at least one member of the feral parliament, is acting in the interests of Australia.
Shame about the rest.
did you mean feral or federal? Your comment best of the day so far!
Yes.
The burgeoning number of white Africans finding a welcoming home in Australia is truly remarkable.
Show me proof that hybrids are a "vital stepping stone" to full EVs please
It's time to take of the PHEV training wheels.
How about we put an even bigger tax on ICEV.
Perfect!
Let's say 20% on ice.
And then subsidise every bev at 30%.
$60k vs $35k
Which would you choose?
Extra fuel excise to pick up the slack.
Just needs a bold govt. So probably doomed.
Yep. Let’s slog all the apartment block residents and renters who don’t have access to a home EV charger. Top idea! They’re way more than a third of the population, so it’ll raise plenty of revenue we can give back to the rest of the population lucky enough to own their home and have an EV charger installed.
Hell, why not? Renters in particular are used to subsidising the rest.
Well require apartment strata companies to make EV charging available in the apartment carpark or 24/7 in a nearby secure environment. Could start with say 1/4 of car parks having EV chargers and build on it as demand grows. Only needs to be L1 (equivalent to a kettle)
Excellent points.
Make the manufacturer include a free home charging kit with every car, needed or not. Charge the landlord for installation, tax deductable property improvement.
Everybody wins.