Friday, May 3, 2024

Utes the end of an era

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Utes

The other week I wrote about the lack of electric vehicle charging stations across regional Western Australia, adding to the cost and inconvenience of owning a climate saving vehicle. I wrote also about the Australian government’s adoption of the strict new Euro 6d emissions standards and its likely future impact on the sale of utes.

This week I thought I would join the two together and give you my views on what this is likely to mean politically and its potential to redefine Australia.

Let’s start with a recap of the governments two recent announcements linked to car emissions.

The first is to impose the Euro 6d standard as the minimum for all vehicles that are sold by the end of 2025.

Euro 6d is the sixth standard for exhaust emissions. It came into play in Europe in 2015, with Australia moving to adopt it in 2026.  Australia adopted Euro 5 standards back in 2009.

For a diesel to be Euro 6d compliant, it cannot emit more than 80mg/km of NOx gases, while a petrol car can emit no more than 60mg/km.

Not only do the new standards cull out most big engines, but in parts of Europe where the local council has set a clean air zone, any vehicle that does not have a Euro 6 engine is subject to a daily charge of around $20, something that will no doubt warm the hearts of our progressive green councils like Fremantle with renewable enthusiasm.

But it does not end there. Europe has just signed off on the Euro 7 standards which are coming into force from July 1 2025, which cut diesel cars down to the same level as petrol at 60mg/km.

Which means big diesel utes are on their way out across Europe as only vehicles with small engines and more expensive exhaust particulate filters will meet the standard.

This has already seen a number of global manufacturers announce they will soon end the development and manufacture of the next generation of new combustion engines.

This means that small city hatches like the Ford Fiesta are on the chopping board, as the engine technology they use has not kept up with the new standards.  It also means that rice burners with the latest technology like the Nissan Z are also on death row as the engines are too big and powerful, which equates to higher emissions.

With Euro 7 forthcoming the business case to even keep building internal combustion engines becomes less viable by the day.

This is music to the ears of both the climate catastrophists and the Chinese car makers, as the European elite seem happy to destroy their car-making industry while the Chinese elite are happy to fill the gap.

In its wisdom, our government has set us on the journey to follow the Europeans and legislate big engine cars off the road, which is crazy brave politically when the top three selling vehicles last year were all utes – Ranger, Hilux and DMax.

This is the problem when the decision makers live in Melbourne, Sydney and Canberra, far from the reality of the commuting tradie or farmer, both of whom need utes as a tool of the trade.

The new fuel efficiency standards the government has adopted are specifically targeted at driving SUVs off the road, with the Euro 6 emissions allowed progressively reducing from 199g/km 2026 to 81g/km in 2029. That’s a 60 per cent reduction within five years, with none of our utes meeting the target by 2030.

While the big utes with big engines won’t be banned from the road, carmakers will be fined about $100 for every gram of carbon per vehicle their fleet exceeds the threshold from 1 January 2025.

There will be a credit-trading system, with suppliers who beat the targets able to trade credits with those who fall short, but few will be in a hurry to trade credits as all manufacturers will be scrambling to drop their average emissions across their fleets.

Motor vehicle commentators are saying that the new fuel efficiency standards could force half of all new car sales to be electric by the end of the decade.

The decision by Albanese reminds me of Bill Shorten’s mad emissions target that he announced ahead of the 2019 election that also was aimed at big SUVs.

At the time the green left within the ALP got very excited, but Shorten quickly dropped the policy when he looked at the polls which were responding to the “Shorten wants to end the weekend” campaign run by Morrison.

This time round Albanese is trying to sell the upside of having an E-ute by claiming that the cost of living saving is $1000 a year in fuel while quietly ignoring the depreciation and cost of buying a $90,000 Chinese made eLDV vs $50,000 for the diesel version.

The Chinese car manufacturers don’t care which one you buy, they will make and sell you either, but battler Bluey from the bogan boonies might not be too happy when told that his aspirational dream car a RAM V8 5.7 Hemi or Landcruiser 79 series V8 may no longer be sold, but he can always aspire to own a Chinese made eUte.

This is political gold for the opposition.

To meet the targets, manufacturers will have no choice but to drop models or push up the process to encourage buyers to select smaller or electric vehicles out of their fleet.

Dutton has the opportunity to wedge the government by accepting the standards for non commercial vehicles, but any ute registered to a business should remain with Euro 5 until there is widespread access to electric vehicle charging stations across regional and remote communities. Something that is decades away.

The opposition should also hold the line and say Euro 7 will not be introduced under their watch, rather they will let the market drive the take up of electric vehicles by offering tax incentives for home owners and businesses to install electric chargers and batteries linked to solar at home.

This is a win win as it leaves tradies and farmers to buy the vehicles that best suit their circumstances while offering a carrot to home owners to install home infrastructure for electric vehicles which might attract a few Teal voters back to the Liberals as they love taxing the poor for their own personal benefit. Without a viable alternative policy that rolls back the Euro 6 standards on utes and prevents the introduction of Euro 7 standards, then we are looking at the end of an era of the ute as part of our culture.

Related stories: The ute is going, going …; Electricity does not come cheap in the bush

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