We are the Australian EV industry and we have a problem. Only 6010 EVs were sold in April, that’s only 6.6% of vehicle sales, down on March and highly disappointing.
Every release of figures is greeted by a colossal whinge from the Federal Chamber of Automotive Industry. Today’s entirely predictable whinge is from FCAI CEO Tony Weber who said removing the tax support for plug in hybrids has led to an “immediate and disappointing” drop in demand in a price-sensitive vehicle market.
But it was tntirely predictable because the sunset date for the tax break on PHEVs has been known about since the programme was instituted.
I’ve got news for Weber; I wish we did have a ‘price-sensitive vehicle market’, but we don’t. Given we’ve had some aggressive price cutting by a number of brands and sales are flat if not down; any high school economics student can tell you if you cut your prices and sales drop, you don’t have a price problem.
This is an important moment: Labor is back in, the NVES is coming in and penalties are here to stay. The vehicle industry has a big problem – $2.9 billion in penalties by 2029 is the Motor Trade Industry Association of Australia’s maths is to be believed.
I’m sure that there will be a clamour for more policy, more taxpayer’s money to be thrown at this. The Electric Vehicle Council is surveying the industry right now about what policy moves it should advocating for, and I’m sure the FCAI will be talking to its members.
Before we volunteer to put our hands in everyone’s pockets. Shouldn’t we try and understand the problem first?
Back in 1991 an academic by the name of Geoffrey Moore, in his theory of technology adoption and fusion, identified a chasm between early adopters and the majority of consumers. Successfully crossing this chasm is what all technologies have to do and they have radically change how the product is presented and marketed.
Early adopters are like me, and probably like a lot of the readers of The Driven. The new technology excites us, we like the challenges, the problems to be solved, all in the name of being first, of pioneering.
This is the opposite of what majority consumers want – for majority consumers to adopt a new technology they have to know how its going to make their lives better, and substantially better at that, if they are going to invest their time and money in the transition.
We as an industry are not very good at selling the dream of EVs, practically the first thing any of us tells a prospective EV owner, is ‘hey, let me solve your problems with charging’, to which a prospective own might well respond ‘I didn’t know I was going to have any issues with charging, maybe I’ll buy a petrol car instead’.
We don’t focus on the joy, the simplicity, the fun of owning an EV. If we can’t generate excitement about the big change we want people to make then thy aren’t going to make it.
So what do we need to do? Nielsen reports that in 2024 the Australian Automotive industry spent $676million on marketing. The auto industry are past masters at creating excitement, creating demand for categories that didn’t exist.
When I was a kid in the 80s most car brands had 3 or 4 models – small medium and large saloons with maybe a hatchback or estate variant (think BMW 3,5,7 or Ford Fiesta, Escort, Sierra, Granada).
No one drove SUVs because they didn’t exist. The auto industry manufactured desire for whole new categories of vehicles, sold the lifestyle, sold the dream. Now 56.9% of sales are SUVs
If the auto industry wants too sell EVs and avoid the penalties under the NVES they have to direct their massive marketing budget, not at selling individual models, not even at selling their brands but selling the dream of electric motoring. Before you can sell anyone an electric car they have to want to buy one, to be excited about the prospect.
If this means innovating how cars are marketed, replacing tired old marketing agencies, connecting with consumers in new ways. This is where the Electric Vehicle Council and FCAI can lead. We need to evolve – bringing brands and money together, not to compete for customers but to create customers in the first place.
Ed Lynch-Bell is Principal at Second Mouse, dedicated to building more sustainable energy tech and mobility products, services and businesses. Ed is also a co-host of the Melbourne and Sydney EV Meet-ups, bringing the e-mobility industry together.