The questions still holding back broader EV adoption in Australia

There’s some hope for the widespread adoption of electric vehicles with the federal government finally reaching an agreement to cut the fringe benefits taxes on the sale of new high-end EVs.

It’s progress, but we know that more needs to be done. The range of EVs in Australia needs to improve. We know that all EV prices need to drop. We also know that without fuel standards in place, Australia will become a dumping ground for excess combustion engine cars.

But there’s some blindspots in the debate around EV adoption in Australia. I’ve been driving a Tesla for some time now, and I still can’t unequivocally recommend one to everyone just yet.  And I feel that some of the small wrinkles I’ve noticed may be playing on the mind of would-be adopters.

With the new federal government still ironing out its full national EV policy, my hope is that by discussing these points now, they factor into its decision making.

Where will I get my next charge?

Back in 2019, Scott Morrison famously claimed that EVs would “ruin the weekend” because you couldn’t drive great distances. After years of driving an EV, I can confirm that this definitely isn’t the case. But a more local form of range anxiety still plays on my mind. 

I live in the South Eastern suburbs of Melbourne. There’s plenty of charging points near my area, many have been introduced in the past few years. Yet, there’s only one fast charging station near me and its two suburbs away. I ended up installing a wall charger to ensure I was never caught short of battery life. But those without off street parking or the funds to have this installed may not be so lucky.

It’s limitations like this that mean EV drivers still don’t quite have the freedom of a combustion engine car. If they are low on fuel, I can take 10 minutes to top up ahead of a trip. Even on a fast charger, it can take up to 40 minutes to fully recharge my car, and I have to make a trip several kilometres away to do it. Running an EV without a home charging kit would be significantly more difficult. 

Fast charging is on the rise. The latest State of EV report found that there was a 22% increase in the number of stations installed since 2021, with there now being over 350 across the country. 

But contrast this to petrol stations. As of March 2021, there are 3,459 petrol stations across Australia, hundreds in each state, most with multiple bowsers. Aside from driving across Australia’s red centre, it would be rare that you would be in a situation where you are out of fuel and can’t find a petrol station.

There are plenty of initiatives tackling this, including curbside charging and introduction of more public fast-chargers. But as it stands, were you to purchase and drive an EV today, without a home-charger, you’d have to be more strategic than usual with how you drive.

Will my EV be actually worth something in five years time? 

EVs have held their value remarkably well in Australia. For instance, while you can expect to see depreciation of around 50% within three years, Redbook estimates that a 2019 Tesla Model 3 will only lose around 10% of its value within the same period. This cushions the financial blow of purchasing an EV, as the cheapest car still sits around the $45,000 mark.

But as a player in the auto industry, I’m acutely aware of just how fast technology is moving, and I’m sure other consumers are too.

I’m keeping a close eye on the progress of hydrogen fuel cell technology, and I’m curious as to whether it will overtake EVs within the near future. My reasoning: Whereas EVs require new infrastructure — in the form of charging points — hydrogen fuelling stations can be installed by retrofitting existing petrol stations. 

What happens if hydrogen cars become the new norm? Will the EV market collapse? This sounds extreme, but we saw a similar circumstance in Japan with diesel engines. Diesel cars initially took off in Japan with a push from government for their adoption due to their fuel economy. 

After it was revealed they were worse for the environment than their petrol counterparts, the market for these cars caved-in. It would help if there was government support for the early adoption of this trend, which would hedge the risk early adopters are taking… but that then leads me on to my last point. 

If I hold out, will my EV be more reasonably taxed or even incentivised?

Aside from this latest federal government tax cut, there just isn’t that much incentive to swap over right now, even with petrol prices hitting the new records this year. That’s especially the case in Victoria where EV drivers are subject to a usage-based road tax — which increased this year.

This isn’t an argument against tax. EVs need to be taxed effectively in order to ensure the quality of our roads. But this tax-first-drive-adoption-later approach seems boggling when the overall idea is to phase combustion engine cars off the road and encourage broader uptake of EVs.

Regardless of how you frame it, buying a car is a financial decision. While the political haze is clearing, the uncertainty to date would make it tough to justify such an investment from your everyday consumer.

Changing our approach to EV adoption

Let me reiterate, I’m happy with my EV. But considering the points I’ve just outlined, in addition to the broader issues around the range of EVs on the market and their purchase prices, it’s plain to see why they aren’t flying off the shelves.

There is more interest than we can keep up with to try an EV on subscription, but we know that consumers are still wary about purchasing one.

I want Australia to move faster with the uptake of EVs. There’s no reason we can’t be among the global leaders in their adoption. We may never surpass Europe or China; we are a totally different market with different driving habits. But there’s no reason why we can’t aim to at least keep pace with the US, which has similarities in terms of cars per capita and how they use their vehicles.

Yes, we need solutions for the big problems facing EV adoption regarding supply, policy and price points. But until we shift our perspective, and also consider the circumstances and problems affecting the individuals owning an EV, then I don’t believe we’ll turn the dial on this trend as quickly as we need to. 

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Des Hang is the CEO and co-founder of car subscription service Carbar