Concerns over EV road user charges downplayed

While some in the car sales industry have cast doom and gloom on the government’s decision to implement road-user charges on electric vehicles and plug-in hybrids, two major Dunedin dealers say it is a storm in a teacup.

Earlier this week, the government announced EVs and plug-in hybrid vehicles would no longer be exempt from road-user charges, as of April 1.

Owners of light EVs will now have to pay $76 per 1000km, to match equivalent diesel-powered vehicles; and plug-in hybrid owners will pay a reduced rate of $53 per 1000km so they are not double taxed by the fuel excise duty.

Electric vehicle promoter Drive Electric New Zealand believed the decision would make people hesitant to drive electric vehicles, cause a significant drop in sales and slow down the electrification of transport.

However, Gilmour Automotive owner and electric vehicle retailer Alistair Gilmour said he did not believe the changes would have any significant impacts.

"Really, it’s a bit of a nothing-burger because if you look at it, say someone did 10,000km in a year, it would only be about $800 extra, which is still cheaper than a petrol car."

Auto Court Dunedin manager Nelson Cottle agreed.

He said there were two types of people who bought EVs and plug-in hybrids — those who wanted to look after the environment, and those who wanted lower fuel running costs.

Auto Court Dunedin manager Nelson Cottle stands with an electric car on his forecourt. PHOTO:...
Auto Court Dunedin manager Nelson Cottle stands with an electric car on his forecourt. PHOTO: GREGOR RICHARDSON
Despite the charges, they would still be cheaper to run than a combustion engine, he said.

"I think we’ll only see a slight decrease in sales. Time will tell."

His only concern about the changes was that they affected plug-in hybrids.

"We’ve known for several years that road user charges would eventually be introduced on electric vehicles, but the fact that they’re being introduced on plug-in hybrids is a wee bit of a surprise because you’re already paying road user charges on the fuel you’re using in a hybrid.

"You’re getting hit twice — you’re getting petrol tax and road user tax.

"If you’re just driving a hybrid around town, it will be OK. But if you’re driving on the open road a lot, it will be more expensive because you’ll use a lot more petrol."

Overall, he believed the road user charges were "a necessary evil".

"We need to pay to maintain the roads and bits and pieces.

"It will get to the point where there are so many EVs on the road, and if no-one’s paying road user charges on them, then the roading system isn’t going to get maintained.

"It’s a shame, but it did have to come. It’s a necessary evil."

Electric vehicle owner and Dunedin EV Owners’ Group co-convener Pam Mckinlay said hypothetically, even if the charges made it more expensive to run an electric vehicle than a non-electric vehicle, she would still buy another EV because they were better for the environment.

"We’ve always known it was coming and now it’s come.

"I’m surprised it didn’t come sooner.

"It’s really just part of owning an EV or hybrid car.

"We’re not worried about having to pay more. It’s equity in terms of maintaining our roads."