5 Apr 2022

Rush on gas guzzlers before clean car rules introduced

From Checkpoint, 5:12 pm on 5 April 2022

On the day UN scientists issued a stark warning on the state of the planet, it has been revealed buyers flocked to buy gas guzzling vehicles before new taxes came into force. 

It was pedal to the metal last month as buyers raced to snap up higher emission vehicles like utes and SUVs ahead of the dirty car tax introduced this month

Motor Industry Association (MIA) figures show more than 21,000 cars were sold lost month - nearly 8000 of them utes. 

According to the MIA the sales are the strongest for any month of the year ever, by thousands. More than 4300 were sold than the next highest month, to be exact.

The data comes on the same days as a new climate report warns its now or never to limit global warming and there needs to be an urgent shift away from fossil fuels. 

Higher traffic flow at level three on the North western motorway in Auckland.

Photo: RNZ / Richard Sutherland

Crawford told Checkpoint the rush on vehicle purchases before 1 April was larger than he anticipated. But the association knew there would be distortions to the market around the date of the implementation of the clean car discount and high emissions vehicle fee.

"It is a huge month. We expect to see fewer sales in April and May and probably going on for the rest of the year... Every time the government brings in a tax there are changing purchasing patterns before and after the tax.

"But if the government doesn't bring in the clean car discount, then it's not really helping us change patterns," he said.

Crawford said the clean car discount would "help to drive change in vehicle purchasing patterns."

While lower emission electric vehicles were more expensive than traditional vehicles now, the MIA believed they would be more affordable in three to five years. 

"As more people who can afford new vehicles buy them they will eventually come into the car fleet as second and third owner vehicles at reduced prices. So we'll see that trickle down effect, but it's going to take time, and the clean car discount is aimed at trying to kick that along faster."

What was and was not affordable varied between households, but Crawford said the average household would not spend more than $20 to $25,000 for a vehicle. 

He believed once low emission vehicles are easily available in that price range there will be a more significant switch in what Kiwis are driving. 

For now though, there has been a rush on the gas guzzlers.

"The most popular vehicle [bought in March] was Mitsubishi Triton followed by the Ford Ranger followed by the Toyota Hilux ... those are what we call utes - the one tonne trucks. They're used by businesses and farmers in the main.

"Most of those vehicles would attract a fee of somewhere between $2500 to $3500 onwards or maybe slightly higher, from 1 April onwards, so a lot of businesses brought their purchasing decisions forward to try and buy their vehicles before that tax takes effect."

Crawford said typically about two thirds of new vehicles are purchased by businesses. 

"Options to replace utes are probably still in the main two to three years away. 

"There are some commercial vans available that are plug-in hybrid or electric, and there is one electric ute coming to the market this year. But the options by and large are not a lot at this point - you either buy a high CO2-emitting vehicle, or you keep your old vehicle."

SUV sales also rose in March, but Crawford said more and more SUV models were being released with lower emitting engine technologies, like hybrids and plug-in hybrids. And increasingly the smaller models were the most popular.

"So we expect to see CO2 emission reductions occurring in those sectors as we go forward. 

"The other interesting trend - and a good trend in terms of reducing emissions, was the increased sales in pure battery electric vehicles; there were 1700 for the month, which is up on previous months," he said.