‘They won’t survive’: Australia now has vehicle emissions laws and this is the truth behind the New Vehicle Efficiency Standards that have divided the auto industry – Car News

The New Vehicle Efficiency Standards (NVES) were formally passed into law this week in Federal Parliament, officially starting the clock for car brands to reduce emissions or exit the Australian market.

After an investigation by CarsGuide It seems increasingly unlikely that not all brands will be able to meet these new standards and may leave the Australian market by the end of the decade.

“Some of these brands will go out of business,” said one well-placed industry source, who spoke on condition of anonymity because he was not authorized to discuss the matter publicly.

“If these companies can’t or won’t satisfy the market, then that’s it: they won’t survive.”

The brands most at risk are those with limited or no plans for electric vehicles – as these are key to reducing average fleet emissions – and those focusing on larger vehicles, mainly SUVs and utes.

But this is only part of the problem facing the Australian car industry. Our investigation has uncovered more details about the extent of the gap between automotive companies and the highest body that must represent them before the government, the Federal Chamber of Automotive Industries (FCAI).

The FCAI ran an openly anti-EV campaign as soon as NVES was publicly announced, already resulting in Tesla and Polestar leaving the body, but internal documents obtained by CarsGuide under the Freedom of Information Act, reveals more details about the highest body’s position on NVES.

speaking to CarsGuide In March, FCAI CEO Tony Weber indicated that his public statements, particularly comments that electric vehicle sales had reached a “plateau,” were at the direction of FCAI’s board of directors, then chaired by Mazda’s Vinesh Bhindi, with Toyota’s Matthew Callachor and Mitsubishi’s Shaun Westcott. as vice presidents, along with representatives from Honda, Ford, Hyundai, Nissan, Stellantis and Inchcape Australia (Subaru, Citroen and Peugeot).

The NVES became law this week in Parliament.

“We are a broad church,” he said in March. “Yes, there is no doubt about it, and that is why we have a constitution that really establishes the fact that, ultimately, it is the board’s decision. So all the decisions we have made and our response to the government through the consultation impact analysis have been done through the board.”

However, an internal FCAI document with conversation notes prepared by an external government relations consultant, The Civic Partnership, in November 2023 was submitted as part of a Senate investigation and presents several potentially inflammatory comments about members who the FCAI must represent.

CarsGuide has obtained a copy of the document through the Freedom of Information Act, despite an effort by the FCAI to prevent it from being made public.

In a letter dated April 19, 2024, Weber wrote a letter to Mr. Patrick Hodder, Secretary of the Senate Finance and Public Administration Reference Committee, explaining the document.

The letter read, in part: “The FCAI requested that access to the documents be denied based on a number of reasons, including that the material was provided as full and frank advice to the government in relation to complex policy issues and that the restriction of such advice in the future could impede government deliberation and would not be in the public interest.”

Car manufacturers will soon be penalized for selling highly polluting vehicles.

In the original November document, the FCAI called car companies “almost schizophrenic” on the issue of electric cars and accused them of misleading the public about their true views on electric vehicles.

“OEMs (original equipment manufacturers) are almost schizophrenic about this,” the document reads. “There is an inherent contradiction between broader political issues in the automotive industry and competition between brands in the market. Many OEMs will privately criticize policy settings in this area, but will publicly position themselves from a marketing perspective to adopt it. “This leads to the announcement of electric vehicles being planned in a situation where there are no real plans to build and supply them.”

Such comments are unlikely to be well received by FCAI members, especially brands investing in EVs, as a multi-page supporting document details how limited EV options could be in the near future.

Weber explained his position in his April letter to the Senate Committee, writing: “In relation to the ‘almost schizophrenic’ comment, the FCAI refers to comments in the document itself, which refer to inconsistencies in the positions held by the companies with respect to the bigger picture. a matter of policy, its competitive positioning and its ability to deliver new vehicles within certain deadlines. I refer to the Cambridge Dictionary definition of the term as ‘having qualities or attitudes that are different from each other and that do not work well together.’”

The November paper also compared discussions over a vehicle emissions standard to Voice to Parliament, the constitutionally recognized Aboriginal and Torres Strait Islander referendum, which became a controversial and divisive public debate. .

Exclusive electric vehicle brands, such as Tesla, will benefit from the legislation. (Image: Richard Berry)

He said: “The theme is like the Voice: most people support the concept, until they see the details. “Once it becomes an argument about cost of living and consumer choice it is (sic) dead.”

Instead, the FCAI called for a “more cautious approach” that would “allow more time to monitor the progress” of changing technology and consumer trends. This was despite the Federal Government discussing fuel efficiency standards with industry since 2010 and Australia being one of only two developed nations in the world without any such public policy (the other being Russia). Publicly, at least, many car brands have been advocating or supporting a fuel efficiency standard in Australia for many years.

With the new rule officially enacted, car companies now have to start reducing emissions by July 1, 2025. While the auto industry was able to win some key concessions, such as the reclassification of body-on-frame SUVs as commercial vehicles light and therefore subject In addition to a higher CO2 emissions figure than passenger cars, all OEMs on the market, except Tesla, Polestar and any new all-electric brand, face significant challenges in dealing with these dramatic cuts .

As our informant made clear, brands without access to electrification, and even some with access to hybrids and plug-in hybrids, will have a very difficult time meeting the average passenger vehicle target of 58 g/km CO2 by 2029, which will be necessary to reduce. from 141g/km from 2025. Even with concessions on body-on-frame sport utility vehicles and SUVs, the 110g/km target by 2029 will be a challenge for model-based brands. CarsGuide has seen.

Regardless of the challenges and internal politics, the rapid passage of NVES by the House of Representatives and the Senate in a single day, without committee hearings, underscored the seriousness with which the government was finally taking the implementation of some regulation for the Australian automotive industry. .