Govt's Clean Car Discount explained: Why utes, SUVs and V8s will be more expensive in 2021

News 10/07/2019

Yesterday the Government proposed it's Clean Car Discount scheme, offering a discount of up to $8000 on a newly imported electric car, or a fee of up to $3000 for vehicles like utes, 4x4s and V8s.

The proposed scheme is part of the Government's plan to reduce pollution, which it says will make a "major contribution to meeting New Zealand's climate targets".

But how does it actually work? Let's explain...

The Clean Car Discount policy is proposed to come into effect in 2021. The scheme is split into discounts and fees for new and used vehicles, depending on how much CO2 is pumped out the exhaust.

Vehicles imported that emit 0-4 CO2/km would get $8000 off, compared to new imported vehicles that emit over 251 CO2/km, which would merit a $3000 fee.

Imported vehicles that aren't brand new would grant lower discounts and fees. For instance, used vehicles that emit 0-4 CO2/km would get $2600 off, while the most-heavy polluters would get a $1500 fee. It wouldn't apply to motorbikes, military operation vehicles, or non-road registered vehicles such as farm tractors.

Here's how that would look for the top five most popular used imported vehicles (2009 models) in 2018.

  1. Mazda Axela:  130 CO2/km = $800 discount on approx. $8000 retail price
  2. Suzuki Swift: 120 CO2/km = $1100 discount on approx. $8000 retail price
  3. Nissan Tiida: 125 CO2/km = $800 discount on approx. $8000 retail price
  4. Toyota Corolla: 122 CO2/km = $800 discount on approx. $9000 retail price
  5. Mazda Demio: 120 CO2/km = $1100 discount on approx. $11,000 retail price

Here's how it would look for the top five most popular new imported vehicles in 2018.

  1. Ford Ranger: 193 CO2/km = $2250 fee on $41,000 approx. retail price
  2. Toyota Hilux: 188 CO2/km = $2000 fee on $50,000 approx. retail price
  3. Toyota Corolla: 138 CO2/km = $800 discount on $35,000 approx. retail price
  4. Toyota Rav4: 154 CO2/km = No discount/fee on approx. $46,000 retail price
  5. Mitsubishi Triton: 182 CO2/km = $2500 discount on approx. $56,000 retail price

Vehicles like the Toyota LandCruiser will be $3000 more expensive, the Mitsubishi Triton will jump by $2500, the Ford Ranger will be $2750 more and the Toyota Hilux will increase by $2000.

National's Associate Transport spokesperson Brett Hudson said hiking the cost of certain vehicles will impose more costs on some families who can't afford to switch to an electric vehicle.

"Vehicle emissions are one of the biggest contributors outside of agriculture, so we need to work on reducing them. But doing so shouldn't come at the expense of New Zealanders' wellbeing by increasing the cost of living further."

But Associate Transport Minister Julie Anne Genter - who announced the policy - said it would save the country more than $3.4 billion in fuel and result in fuel savings of more than $6,800 over the lifetime of an average vehicle. 

The targets - which would get stricter each year - would be weight-adjusted so that smaller vehicles would have to meet stricter targets than heavy vehicles like utes.

In 2022, the proposed average emission target would be 161 CO2/km with stricter targets each year out to 105 CO2/km in 2025.

Newshub.