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Wednesday, 23 June 2021 09:55

Govt's electric car policy set to hit farmers in the pocket

Written by  Mark Daniel
Farmers and tradies needing larger vehicles for their day-to-day work will be hit the hardest. Farmers and tradies needing larger vehicles for their day-to-day work will be hit the hardest.

At a time when New Zealand's rural sector is already carrying a large can to keep the country's finances in the black, it looks like that can will get a little heavier.

The Government's recently released Clean Car Discount Package is designed to encourage the uptake of electric vehicles with cash rebates of up to $8,625 for those purchasing "pure" electric vehicles (EV).

While the ida of everyone driving around in EVs is laudable, from January 2022 the sting in the tail will be a penalty of around $3,000 on the purchase price of utes, which will be used to subsidise the "go green" initiative.

This means that farmers, rural supply companies and an army of tradies who need these larger vehicles for their day-to-day work, will be subsidising urban dwellers to help them buy a low emission runabout or town car.

The penalty may increase even further in January 2023 when the Government's Clean Car Standards come into play - aimed at penalising manufacturers of vehicles with higher CO₂ emissions, meaning a further hike in purchase prices.

David Crawford, chief executive of the Motor Industry Association, says the problem for users of such vehicles is there are currently no alternatives available. He says while there is talk of electric utes being available by 2030, even hybrid utes are not likely before the middle of the decade.

In the same vein, DairyNZ chief executive Tim Mackle is suggesting that because of the fact that vehicles of this type are essential for farmers and rural professionals, rather than a "nice to have" purchase, they should be exempt from the scheme until other greener options are readily available.

Some industry observers are suggesting that the financial implications of the government initiative might result in some users holding on to and running older, dirtier vehicles, while trade-in prices for these vehicles is likely to take a hit.

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