Hundreds of Australian motorists will be able to access cheaper loans for electric vehicles as part of a $20.5 million investment by the Clean Energy Finance Corporation.
The cash injection, announced on Monday, will be used to fund more than $100 million in loans for battery electric and plug-in hybrid vehicles through Taurus Motor Finance and EV Direct, which represents car maker BYD.
The discounted offers could see car buyers save hundreds of dollars over the course of a loan for vehicles priced under $90,000.
The announcement comes just days after tax cuts were approved to lower the price of some electric vehicles in a deal between the Albanese government, the Greens and Senator David Pocock.
The National Electric Vehicle Strategy consultation paper recently received more than 500 submissions about policy changes.
The latest investment in electric vehicles will see motorists offered loans at a discounted rate that could see them save $1300 over a seven-year loan for a $48,000 vehicle.
Federal Energy Minister Chris Bowen said the investment was designed to lower the initial cost of electric vehicles so Australian drivers could unlock cheaper overall transport costs and reduce their emissions.
“Electric vehicles are cleaner and cheaper to run but Australians are missing out on these benefits because of the price,” he said.
“Cheaper loans supported by CEFC finance are a strong incentive for them to buy EVs and will help decarbonise the transport sector.”
The price of new battery electric vehicles remains high in Australia compared to the rest of the world, with the cheapest models available for about $46,000. An entry-level Tesla costs $65,500 while a Polestar costs $67,000.
Richard Lovell from the Clean Energy Finance Corporation said the investment was designed to give motorists a “powerful incentive” to invest in electric vehicles and give manufacturers more confidence to launch vehicles in the Australian market.
“At least half of all car buyers in Australia finance the purchase with a car loan,” Mr Lovell said.
“Working with Taurus to establish a new green car loan has the potential to improve EV availability because it offers original equipment manufacturers the certainty that potential customers can access finance to buy their cars.”
EV Direct chief executive Luke Todd said the company would work with Taurus to create “low-interest green financing” packages for its BYD vehicles, the first of which, the BYD Atto 3, received a five-star ANCAP safety rating one week ago.
Another two BYD electric cars – a hatchback and sedan – are expected to launch in Australia in the first half of 2023.
“”There’s been a lot of money put behind charging and other EV infrastructure projects but this is the first direct government support for a vehicle itself,” Mr Todd said.
“This will allow more Australians to afford the transition to an EV and that’s the key thing – it’s about affordability. Environmental benefits are important but it’s now clearly demonstrated that driving an EV, if it’s purchased at the right price, it’s more economical.”
With new loans and tax policies, Mr Todd said 2023 would be a “pivotal” year for the transport technology.
More than 20 banking and finance companies also offer discounted rates for the purchase of electric vehicles in Australia, including Westpac, Macquarie and Bank Australia, which this year announced it would stop financing loans for petrol, diesel and hybrid vehicles from 2025.
Electric vehicles accounted for just 3.39 per cent of new vehicles sales in Australia until September 2022, according to the EV Council, representing a 65 per cent increase from 2021.
Jennifer Dudley-Nicholson
(Australian Associated Press)
