VIA supports the Clean Car Programme in principle.
While VIA has several concerns regarding the initiative and our modelling has shown several likely risks due to the speed of implementation, we are committed to being part of the solution in reducing greenhouse gases. To address these concerns, VIA will continue to work closely with government to build mitigations and safeguards into the programme.
VIA recognises that the implementation of the Clean Car Programme will negatively impact business-as-usual for our industry, but further inaction will only compound the costs and challenges of what is an inevitable change.
The biggest challenges we have identified will be a near future lack of zero-emission vehicles between 2027 and 2035 and the lack of tools for managing the existing fleet.
While most motor vehicle manufacturers have committed to moving away from fossil fuels in the latter half of this decade, there is significant and growing demand for these vehicles due to a near unanimous global commitment to reduce greenhouse gases, with all nations specifying transport as an initial target.
Due to this, both of New Zealand’s supply paradigms will have inherent delays and challenges. New car importers will be forced to compete for that limited new car supply with jurisdictions with domestic manufacturing and/or higher wages. Used car importers will not be able to take advantage of the increased volumes of zero-emission vehicles until they enter the second-hand market in their source jurisdiction.
The Clean Car Programme aggressively disincentivises the importation of greenhouse gas emitting vehicles. By the end of this decade, even hybrid vehicles will fail to meet the requirements. If a sufficient supply of zero-emission vehicles cannot be sourced, it will result in import penalties that will be passed on to consumers, leading to potentially significant increases in vehicle prices.
VIA also notes a lack of levers within the Clean Car Programme to manage the existing fleet. As vehicles prices rise due to the chain of reasons just explained, vehicles in the fleet will increase in value. This will lead to them staying in the fleet longer, reducing the conversion to less-emitting vehicles.
VIA is proposing a single solution that we feel will provide the government with the levers necessary to mitigate both of these risks. VIA recommends that the Clean Car Programme be extended to include a Clean Car Fleet Management Scheme.
The Clean Car Fleet Management Scheme will provide a set of tools that empowers the government to provide credits for removing greenhouse gas emitting vehicles from the existing fleet. This scheme will improve the Clean Car Programme, exemplified by empowering government to reduce the impact of Clean Car Standard penalties on consumers without reducing ambition or continued improvement of the fleet.
The Clean Car Fleet Management Scheme provides mechanisms to incentivise the scrappage of greenhouse gas emitting vehicles, a tool that will be useful now, but absolutely necessary once an abundant supply of zero-emissions vehicles becomes available.
VIA members have committed to supplying quality vehicles that meet the needs of New Zealanders as we transition into a carbon-neutral future. The following consultation will provide feedback on the issues and risks we have identified as well as our recommendations on how it can be improved to meet New Zealand’s unique needs.