Photo: Unsplash / Oxana Melis
It does not take a rocket scientist to realise the government's decision to implement road user charges for electric vehicles will really slow down sales, industry group Drive Electric says.
On Tuesday, the government announced EVs and plug-in hybrid vehicles will no longer be exempt from road-user charges as of 1 April.
Owners of light EVs will pay $76 per 1000 kilometres, to match equivalent diesel-powered vehicles.
Meanwhile, plug-in hybrid owners will pay a reduced rate of $53 per 1000km so they are not double taxed by the fuel excise duty.
Drive Electric chairperson Kirsten Corson told Morning Report the decision alongside losing the EV clean car discount will have a significant impact on sales.
"We know the biggest barrier is the upfront capital cost of EVs is higher, so we do need to talk to the government and see how we could put some incentives in place like other countries do" - Kirsten Corson
"[It's] disappointing in our bid to hit our Paris Agreement target."
Corson said incentives had a "dramatic" impact on sales, with EV sales sitting at around 2 percent of new car sales every month in 2018. That increased to more than 27 percent by 2023.
"We know the biggest barrier is the upfront capital cost of EVs is higher, so we do need to talk to the government and see how we could put some incentives in place like other countries do."
Corson did not think people who had already purchased an EV would be regretful of their choice as they would have benefited from the former clean car discount.
"When you look at charging your EV overnight costs you $2 per 100km if you're charging off-peak, and filling up a petrol car is around $21 per 100km so there's still massive saving with driving electric vehicles."
But she said the government's decision would make people hesitant to drive electric and slow down the electrification of transport.
That was something she wanted to talk to Transport Minister Simeon Brown about, she said.
Transport Minister Simeon Brown. Photo: RNZ / Samuel Rillstone
Speaking to Morning Report earlier, Brown said the coalition government was committed to ensuring all vehicles eventually paid road user charges.
Advice had shown about $80 million in revenue would be brought in because of the changes, he said.
"This is about ensuring all users of our roads are contributing towards building and maintaining them so we can fix potholes and improve out roading network" - Simeon Brown
But there was another problem to address to make roading contributions fair.
As petrol vehicles become more efficient they will pay less in fuel excise duty, Brown said.
"What we're committing to too in the National-ACT coalition agreement, we'll be moving all vehicles to road user charges. So it doesn't matter what type of fuel you're using - whether that's petrol, diesel, electricity, you've got a plug in hybrid - you'll pay the same amount based on the number of kilometres you use of the road.
"Rather than based on the fuel consumption you have or the type of fuel that you use".
Brown said the government would have more to say on that in the future and removing the exemption for EVs was just the first step.
"This is about ensuring all users of our roads are contributing towards building and maintaining them so we can fix potholes and improve out roading network".
When asked whether an electric vehicle was what was ripping the road apart, Brown doubled down on his point that all road users need to contribute.
"A Nissan Leaf needs a safe road to drive on and so all road users need to contribute towards that ... but the reality is those heavier vehicles, trucks which have greater weight, they contribute a whole lot more in terms of what they pay due to their weight and the number of axles they have."
'Not in it just for the savings'
One Christchurch car retailer said customers were still buying electric vehicles this morning, despite Tuesday's announcement.
EV City owner David Boot said it was too soon to say whether his sales would be affected by the change. He said electric and plug-in hybrid vehicles would still be cheaper to run, but not as cheap as the last five to six years.
"What I can tell you from this morning is that we do have people walking in through the door buying vehicles in spite of the road-user charges coming."
Boot said the amount being charged was fair, and would not worry most electric or plug-in hybrid vehicle owners.
"EV owners are early-adopters, they're innovators, they're people who are interested in the technology. They're certainly not in it just for the savings."