EVs could match petrol cars on cost by next year in Australia

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BNEF says total cost of EVs could match petrol cars as early as next year in Australia, and says Labor’s target of 50% share of sales by 2030 is feasible.

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The Driven

The total cost of ownership of some electric vehicles in Australia could match that of their petrol and diesel equivalents as soon as next year, according to BloombergNEF, and – with the right policies – the share of new vehicle sales could reach 50 per cent by 2030 as targeted by Labor.

In a major new report looking at the Australian vehicle market, BNEF says the prospect of growing interest in EVs and their rapidly falling costs means that the share of new sales would likely reach 28 per cent on a “business-as-usual” basis.

But, it says, with the right policies the gap between 28 per cent and Labor’s targeted 50 per cent could be reached. And it appears to endorse Labor’s strategy of focusing on the fleet market, which BNEF says will be the first large-scale adopters of EVs.

Fleet owners are more attuned to the “total cost of ownership” rather than just the upfront costs, and a breakthrough moment could occur as early as next year, BNEF suggests in its report.

“Electric vehicles should start to achieve total cost of ownership parity with equivalent ICEs (internal combustion engine) as early as 2020 in Australia for some segments of the market,” BNEF analyst Ali Asghar says in his report.

“The TCO (total cost of ownership) is the metric likely to influence purchasing decisions of fleet owners and managers,” he says.

“Since TCO parity could start earlier than upfront cost parity of EVs (relative to ICEs), it is likely that fleet purchases in Australia will pick up prior to significant growth in private car purchase.”

Labor’s proposal to target a 50 per cent per share of new vehicle sales for electrics and plug in hybrids by 2030 has – surprisingly – caused uproar in Australia as the Coalition and conservatives reacted with bizarre predictions of the death of the weekend and accusations that Labor wanted to “steal” people’s utes.

The debate is even more bizarre because the Coalition’s own emissions reduction policy assumes as uptake of EVs somewhere between the BNEF forecasts and Labor’s target. It plans to reveal its own EV strategy next year, should it retain government, but refused to do so in the election campaign.

To see the graphs and read the full story, please go to RenewEconomy’s electric vehicle dedicated site, The Driven, and click here…

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