$9,342 price hike warning for Australian drivers under New Vehicle Efficiency Standard scheme
New figures have revealed how much more Aussies will likely have to fork out for a new car due to the government's emissions scheme. The New Vehicle Efficiency Standard (NVES) kicked in on January 1 and it gives every car manufacturer a CO2 target that they either have to meet or beat each year.
That target is lowered each year until 2029, which will put increased pressure on brands to have zero or low-emissions vehicles in their fleet. CarExpert.com.au founder Paul Maric told Yahoo Finance that regular Aussies will likely be the ones hit by this new program.
"Some of the manufacturers may take a margin hit, but I think that given that they've got shareholders and no one likes to lose money, I think they're just going to end up passing the cost of that onto consumers," he said.
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How much will new cars cost under the NVES?
The Motor Trades Association of Australia (MTAA) calculated what the NVES will likely mean for manufacturers and consumers.
While the association said the new scheme is a big step in the decarbonisation of Australia, it noted that complying with the new rules will "undeniably present substantial challenges for some car companies".
"Our assessment based on publicly available information indicates that of the top 10 brands, 60 per cent will need to make significant changes to their model line-ups to meet their 2025 and/or 2029 emission reduction targets," it said in a pre-budget submission.
It added that manufacturers will have a few options up their sleeve under the NVES:
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Introduce new low-emission vehicles and technologies
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Purchase credits from EV-only manufacturers
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Increasing vehicle prices
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Reducing the volume of high-emission vehicles
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Exit the market altogether if unable to comply
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If they go down the route of price hikes, it can add up to more than $9,000.
Chevrolet was found to have the biggest jump in car prices by the end of the decade, with the NVES expected to add $9,342 to every car.
The car marker is expected to have no EVs in its fleet by 2029.
RAM, Bently, Lamborgini and Aston Martin were the next on the list, with expected price rises of between $6,756 to $9,128.
The more popular, everyday type of cars in Australia, like Isuzu, Mazda, Subaru, Nissan and Mitsubishi, are predicted to raise their prices between $3,875 to $4,575 in the next few years.
