NZ Government Incentives Coming Soon For Buyers of Electric Vehicles!

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#2229126 2-May-2019 08:00

frednz:

And as for paying for the incentives, just drop GST on new EV's, nobody would even notice this had been done because the number of new EVs being purchased isn't that great because of the very high prices and long delivery times.

I would have a 2017+ Leaf on a boat tomorrow if I could get it into the country without paying GST.

However given production is so constrained worldwide, dropping the price here would just give dealers headroom to move their prices up and improve margins. They don't have to compete on price yet.

Better to rebate GST on imports of 2nd hand EVs up to a certain value (say $40K).

Dingbatt

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#2229171 2-May-2019 09:01

Delphinus:
Why not put it on New ICE purchases. Those that cannot afford it aren't buying new anyway, they are buying second hand, which won't have the tax. Use the tax on New ICE vehicles to subsidise New EV vehicles, so balance out the price premium for early adopters who are doing the better thing environmentally. Plus add no FBT or RUC to pure EV's (not Hybrids or PHEV's).

The same thing would be achieved by increasing the fuel excise (not a tax remember) slightly. Pure ICEs use more fuel than hybrids, which use more fuel than PHEVs, which use more fuel than BEVs. It also drives people towards more fuel efficient vehicles. Ultimately, isn't this the goal?
Increasing the price of new vehicles will have the effect of pulling used prices up as well. So those "that can't afford it" will still be paying more.

What's next? Driving for families maybe?

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tdgeek

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#2229176 2-May-2019 09:06

Dingbatt:
Delphinus:

Why not put it on New ICE purchases. Those that cannot afford it aren't buying new anyway, they are buying second hand, which won't have the tax. Use the tax on New ICE vehicles to subsidise New EV vehicles, so balance out the price premium for early adopters who are doing the better thing environmentally. Plus add no FBT or RUC to pure EV's (not Hybrids or PHEV's).

The same thing would be achieved by increasing the fuel excise (not a tax remember) slightly. Pure ICEs use more fuel than hybrids, which use more fuel than PHEVs, which use more fuel than BEVs. It also drives people towards more fuel efficient vehicles. Ultimately, isn't this the goal?
Increasing the price of new vehicles will have the effect of pulling used prices up as well. So those "that can't afford it" will still be paying more.

What's next? Driving for families maybe?

Cheers for the morning chuckle!

We need a formula that incentivises EV purchases, not gives away cash to those that can already afford it. Not sure what that is, without penalising those on lower incomes. Plenty of time to dwell on it though as the car models, and volume are not available yet. I dont see any Govt doing a great deal for consumers but I can see that for businesses

old3eyes

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#2229178 2-May-2019 09:09

Delphinus:

tdgeek:

Now, if we don't want the Fuel Tax to support AKL transport infrastructure (and lets face it, AKL is key for NZ), how will we do with a Fuel Tax that assists people who can already afford it, to buy a $60,000 new car, while the rest of the populous pay for it by a fuel tax??? The current word is $10k, and a feebate. Many cannot afford a new car, they pay for someone else's new EV, some have a use case that EV cannot provide, so they pay for someone elses new EV. If you can afford a 60k+ EV the 10k is not an incentive. It maybe for some who can stretch to 50k, but lets be realistic, its free money. And every ICE motorist pays for it, as they are poor, or are not poor but cannot afford it, or whose use case is not EV.

Why not put it on New ICE purchases. Those that cannot afford it aren't buying new anyway, they are buying second hand, which won't have the tax. Use the tax on New ICE vehicles to subsidise New EV vehicles, so balance out the price premium for early adopters who are doing the better thing environmentally. Plus add no FBT or RUC to pure EV's (not Hybrids or PHEV's).

Completely against ICEV purchasers subsidizing the rich who can afford a $70 grand EV who will buy them as a status symbol.

Regards,

Old3eyes

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#2229179 2-May-2019 09:09

GV27:

dropping the price here would just give dealers headroom to move their prices up and improve margins. They don't have to compete on price yet.

Better to rebate GST on imports of 2nd hand EVs up to a certain value (say $40K).

Thats a good point. Like fuel prices, a consumer cannot ascertain if the price is fair for a new car, or if dealers are creeping it up as other is a subsidy.

Would a GST saving on a 40k car really get many across the line? Im not so sure.

GV27

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#2229202 2-May-2019 09:42

tdgeek:

GV27:

dropping the price here would just give dealers headroom to move their prices up and improve margins. They don't have to compete on price yet.

Better to rebate GST on imports of 2nd hand EVs up to a certain value (say $40K).

Thats a good point. Like fuel prices, a consumer cannot ascertain if the price is fair for a new car, or if dealers are creeping it up as other is a subsidy.

Would a GST saving on a 40k car really get many across the line? Im not so sure.

Probably not, but setting the max rebate to kick in at a $15K purchase price and then sliding scale it towards $40K would give optimum benefit to the low end.

Giving private importers the ability to claim back GST if a vehicle is for private use seems like a good pressure valve.

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#2229299 2-May-2019 11:16

Treat EV cars the same way as those Utes with regard to fringe benefit tax would be a good start.

How many business really need those huge utes....

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ockel

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#2229300 2-May-2019 11:21

afe66:

Treat EV cars the same way as those Utes with regard to fringe benefit tax would be a good start.

How many business really need those huge utes....

And remove the FBT exemption for utes at the same time.

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GV27

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#2229303 2-May-2019 11:26

afe66:

Treat EV cars the same way as those Utes with regard to fringe benefit tax would be a good start.

How many business really need those huge utes....

The whole Utes vs FBT thing is a bit of a mess and you still need to satisfy other conditions; the fact something is a ute doesn't mean you can do what you like with it when it comes to FBT.

afe66

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#2229312 2-May-2019 11:29

GV27:

afe66:

Treat EV cars the same way as those Utes with regard to fringe benefit tax would be a good start.

How many business really need those huge utes....

The whole Utes vs FBT thing is a bit of a mess and you still need to satisfy other conditions; the fact something is a ute doesn't mean you can do what you like with it when it comes to FBT.

Two friends were going to buy cars for their very urban businesses and asked about EV and both their accountants said no, buy a ute... so they did.

tripper1000

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#2230032 3-May-2019 11:02

old3eyes: Completely against ICEV purchasers subsidizing the rich who can afford a $70 grand EV who will buy them as a status symbol.

LOL, this is classic "me-me-now" and not seeing the wood for the trees, nor the greater good.

That short sighted, big green monster on your shoulder could be diminishing your chances of upgrading your car.

The 2nd hand import market for EV's is near saturated. Increasing demand in the 2nd hand market (which 2nd hand car subsidies would do) will only/is only forcing prices up, making EV's even more unobtainable and improving nothing except profit margins.

The way to make cheap 2nd hand cars is to persuade the "rich" to buy new cars and cop the depreciation, thereby subsidising the 'poor'. So while Subsidising the "rich" today grates on the socialists, it is actually subsidising the "poor" tomorrow. The depreciation hit the 'rich' take on the new cars will likely exceed the (speculated) $10K subsidy, so such a subsidy would actually represent a very good investment for the community lift overall living standards.

Presently, in a N.Z. context the "rich" in this scenario is the Japanese car buying public, but when it comes to EV's the Japanese supply is not meeting N.Z. demand, so we need the kiwi "rich" class to be subsidising cars for the ordinary man.

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#2230036 3-May-2019 11:04

tripper1000:
old3eyes: Completely against ICEV purchasers subsidizing the rich who can afford a $70 grand EV who will buy them as a status symbol.

LOL, this is classic "me-me-now" and not seeing the wood for the trees, nor the greater good.

That short sighted, big green monster on your shoulder could be diminishing your chances of upgrading your car.

The 2nd hand import market for EV's is near saturated. Increasing demand in the 2nd hand market (which 2nd hand car subsidies would do) will only/is only forcing prices up, making EV's even more unobtainable and improving nothing except profit margins.

The way to make cheap 2nd hand cars is to persuade the "rich" to buy new cars and cop the depreciation, thereby subsidising the 'poor'. So while Subsidising the "rich" today grates on the socialists, it is actually subsidising the "poor" tomorrow. The depreciation hit the 'rich' take on the new cars will likely exceed the (speculated) $10K subsidy, so such a subsidy would actually represent a very good investment for the community lift overall living standards.

Presently, in a N.Z. context the "rich" in this scenario is the Japanese car buying public, but when it comes to EV's the Japanese supply is not meeting N.Z. demand, so we need the kiwi "rich" class to be subsidising cars for the ordinary man.

the

Well said.

Hammerer

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#2230085 3-May-2019 12:17

tripper1000:

The depreciation hit the 'rich' take on the new cars will likely exceed the (speculated) $10K subsidy, so such a subsidy would actually represent a very good investment for the community lift overall living standards.

Depreciation, the loss of value of the vehicle after purchase, isn't much use in a calculation of a what is a "good investment for the community". It is more commonly used in calculating "overall living standards" using concepts like nominal GDP.

Also, your calculation looks like: depreciation > subsidy = investment benefit to community. I doubt that logic works because it means the higher the depreciation then the higher the benefit to us all. Higher depreciation is generally associated with reducing overall living standards. Better value products generally have lower depreciation. So it sounds like you'd be happy with subsidising over-valued products?

Anyway, the new vehicle depreciation on new vehicles would largely be incurred anyway even if the alternative of an ICEV was purchased. So you should be using the difference in depreciation to calculate the net benefit against either the non-subsidised EV or ICEV scenarios. But, again, this difference only becomes more significant the more overvalued the EV purchase price which is a likely outcome of subsidising them.

jjnz1

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#2230135 3-May-2019 13:43

What's the reasoning around the purchase price being inflated due to a subsidy. It hasn't in other countries like EU, Canada and the US. (source Tesla Pricing)

Telsa in fact has just reduced their vehicle cost in Canada so their purchasers are eligible for the EV subsidy.

GV27

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#2230168 3-May-2019 14:43

tripper1000:

The way to make cheap 2nd hand cars is to persuade the "rich" to buy new cars and cop the depreciation, thereby subsidising the 'poor'. So while Subsidising the "rich" today grates on the socialists, it is actually subsidising the "poor" tomorrow. The depreciation hit the 'rich' take on the new cars will likely exceed the (speculated) $10K subsidy, so such a subsidy would actually represent a very good investment for the community lift overall living standards.

Presently, in a N.Z. context the "rich" in this scenario is the Japanese car buying public, but when it comes to EV's the Japanese supply is not meeting N.Z. demand, so we need the kiwi "rich" class to be subsidising cars for the ordinary man.

I'll remember that when I'm filling up a 20 year Corolla showing 300,000km+ with petrol that has about an extra 50% on top in the form of tax that the guy cruising past in a $200K Tesla needed that subsidy more. You know, for the greater good. After all, they're apparently subsidising me, somehow.

Presently we don't have an EV subsidy. We might as well wait until there is a 'lower end' of the market and gear the subsidy towards that and get better bang for our buck. Cashed up people are still going to buy a Tesla one way or the other, a $5K subsidy won't make that much of a difference one way or the other when you're spending $100K on a car.

jjnz1:

Telsa in fact has just reduced their vehicle cost in Canada so their purchasers are eligible for the EV subsidy.

They also capped the range at 150km for one Model.

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