New Vehicle Efficiency Standard will combat cost-of-living

Head of Public Policy Dr Michael Kane said the Club largely supported the Federal Government’s New Vehicle Efficiency Standard (NVES), arguing it was not just about environmental benefits but also the safety and financial benefits for motorists.

However, he said changes to the proposed standards were needed to ensure regional Queenslanders, and those who required heavier vehicles like utes, were not penalised, but supported in the push to decarbonise transport.

In the interests of transparency, RACQ urged the Government to release NVES modelling to inform legislation which is set to come into effect in January 2025.

“The modelling is important to secure public confidence in the benefits that will flow,” Dr Kane said.

“A well-designed standard will not only incentivise manufacturers to send better and safer cars, utes, and 4WDs to Australia, but also ensure they are competitively priced.

“Apart from Russia, Australia is the only other advanced nation without vehicle efficiency standards and this should have been fixed a long time ago.

“The longer we don’t have one, the further behind Australia will trail the rest of the world on access to the best cars, utes and 4WDs to drive.”

While RACQ supported the introduction of a NVES, it would like to see some adjustments to the current proposal to ensure regional Queenslanders aren’t left behind.

“We would like to see future fuel efficiency targets for utes and 4WDs relaxed in the initial years to allow vehicle technology to be introduced and to make sure new and more efficient models maintain or even increase in range,” Dr Kane said.

“Vehicle range is a big factor for regional Queenslanders and off-road enthusiasts and the last thing we want to see is any new standard compromising that.”

RACQ is also calling for the Federal Government to support research innovation in utility and 4WD technology and the biofuels industry development.

“Despite improving battery technology there is likely to always be a need for fuel for heavier vehicles in regional and remote parts of Australia. RACQ believes that ethanol and biofuels can play a part in decarbonisation and boosting regional economies,” Dr Kane said.

RACQ has crunched the numbers to show how utes and 4WDs have become more fuel efficient and cheaper to run over the past 60 years thanks to technology advancements. The research suggests Australians could save even more if an appropriate NVES is introduced, especially following recent advancements in electrification, range extenders and hybrids.

“If we stopped innovating in the 1970s and still had the same engines, drive trains and efficiencies in utes today as we did back then, it would cost us $28 to travel 100km, instead of $16,” Dr Kane said.

“In the future we should be aiming for these vehicles to cost less than $10 per 100km and that’s why new vehicle standards are important.

“RACQ has heard concerns surrounding the NVES about affordability but we can find little international evidence pointing to upward pressure on vehicle purchase costs.”

RACQ made a submission to the Federal Government in support of a new Vehicle Efficiency Standard. Read RACQ’s full submission here.

Driving Costs for utes over the last five decades (Source: RACQ, 2024):