Cheaper EVs! Government announces scheme to slash the cost of buying new and used electric vehicles. But there are conditions…

December 19, 2024December 19, 2024 Bruce Newton 692 Views 0 Comments BYD, chris bowen, ev, loan, low interest

The federal government has moved to make the purchase of new and used electric vehicles more affordable.

It is backing a scheme in co-operation with the Commonwealth Bank to cut up to five per cent off the cost of a standard loan to buy an EV and related household EV charging equipment.

The government estimates the low interest loan could save EV buyers more than $8000 off a $40000 loan with a seven-year term – on top of savings from ending petrol bills.

The scheme will be open to workers making less than $100,000 per annum and essential workers such as nurses, police, teachers and so on regardless of income.

It is being backed to the tune of $150 million by the Clean Energy Finance Corporation, with a loan cap of $55,000.

The scheme was announced by the Minister for Climate Change and Energy Chris Bowen at a BYD dealership in Sydney this morning.

BYD even rolled out its forthcoming Sealion 7 EV for the occasion (pictured top), two months before it goes on-sale locally in February.

“Only the Albanese Labor Government is making sure more Australians are able to get behind the wheels of cheaper to run cars and begin saving on their commutes,” Bowen said.

“Discounted loans help remove barriers to ownership, helping more Australians drive cars that can save them thousands of dollars a year.”

The announcement comes on the eve of the start of Australia’s first-ever New Vehicle Efficiency Standard (NVES) on January 1 2025, which is set to accelerate the transition to low emission vehicles.

“The Government has listened to industry,” said MTAA CEO Matthew Hobbs.

“The settings to decarbonise transport need to be both carrot and stick—not just all stick through the fuel efficiency standard.

“Ultimately, for the automotive industry to succeed in the transition, consumers need to buy the cars. As we have seen overseas, targeted consumer incentives are crucial to making that happen—they are a key part of the decarbonisation jigsaw puzzle that we are working to solve.”

Electric Vehicle Council, Head of Legal, Policy and Advocacy, Aman Gaur welcomed the scheme, highlighting its extension to the used car market.

“We are pleased that second hand battery EVs can be purchased with these low interest loans. Most Australians buy used cars instead of new ones, but the pre-owned EV market is still developing so targeted financial incentives and support is required to boost uptake and create a self-sustaining market.”

The scheme is officially restricted to BEVs, but EV Central understands the Commonwealth Bank will also offer the cut rate for plug-in hybrids as well.

This is significant because PHEVs lose access to the FBT exemption available under the Electric Car Discount from April 1 2025.

BEVs will continue to have access to the scheme, which produces significant savings for workers who buy a vehicle via a novated lease.

The low interest loan scheme should help boost sales of BEVs, which have slowed in their sales growth rate to just 3.1 per cent in 2024.

Most of the growth in electrified vehicle sales in Australia in 2024 have come from PHEVs – off a low base – and hybrids.