VW expects 50% electric car sales in Australia by 2030

BRIDIE SCHMIDT
JULY 31, 2019

European car maker Volkswagen is keeping quiet on the Australian release dates for its electric vehicle series, ID, but it says that within 10 years, EVs will make up half of new car sales and an electric SUV will be the focus for the local market.

The German auto group, which plans make and sell 22 million electric vehicles globally by 2030, launching 70 new models in that period, released its first vehicle in the ID series – the ID3 hatchback – just weeks ago.

Its local office has said previously confirmed to The Driven that Australia is definitely on the list to introduce electric vehicles from 2021-2022, and the latest comments from Volkswagen Group Australia product marketing manager Jeff Shafer are in line with the proposed electric vehicle targets proposed by Labor in the run-up to May’s federal election.

“When we look five to 10 years into the future, instead of seeing a very small percentage of sales we will see electric vehicle sales grow steadily over time to maybe … 40 or 50 per cent of sales by 2030,” Shafer told Which Car.

Shafer believes that these figures can be reached even without targets such as that offered by Labor (and which was so ignominiously ridiculed by the incumbent Coalition government despite its own carbon abatement forecasts accounting for a 25-50% uptake by 2030).

These figures are considerably more optimistic than those put forward by a report conducted for the Australian Renewable Energy Agency by Energeia in May 2018, which suggests that with no government intervention, the percentage of car sales that are electric will only hit 20% by 2030.

Price parity is key, says Shafer.

“The price premium has to come down and it is,” he said. “Once the up-front premium becomes more like a diesel premium traditionally, I think people will make a rational choice. That’s upon us in the next few years.”

Price parity for electric vehicles compared to internal combustion engine vehicles (ICE) is largely dependent on the cost of batteries coming down, as well as high upfront R&D costs being spread across EV model portfolios.

A report released in January by market analysis firm Deloitte predicts that the price of EVs will be comparable to ICE vehicles by 2022, although how quickly this will translate to the Australian market where there is no longer an established car manufacturing industry is yet to be seen.

As has been shown overseas, government policies – that would assist in making the case for moderate intervention and 50% EV sales by 2030 as in the graph above – have been to date key in accelerating uptake of zero emissions transport.

How much of the potential EV market in Australia can VW hope to claim?

With 56,620 vehicles sold by VW in Australia in 2018 according to V-Facts it currently accounts for around 5% of the Australian auto market, which favours large utility trucks and SUVs (models such as the Ford Range and Toyota Hilux regularly make the list for most popular models sold).

This is something Shafer recognises: “Where Australia’s at the moment, you’d have to say that an electric SUV is the product that would be most relevant. SUV works well with electric as well – you can position two motors if you want to go all-wheel drive.”

Could the ID Crozz, which is currently being tested on roads in the south of Europe, be the first model to reach Australian shores?

Volkswagen has definitively said that the e-Golf, which it sells in New Zealand and is one of the most popular EVs in Europe, will not come to Australia.

However, as VW Australia’s brand experience manager Kurt McGuiness has previously told The Driven, “We are definitely in interested in bringing EVs to Australia. We are still a few years off receiving them but will be part of an early international introduction of models around 2021-22.”

With a release timeline for the Crozz in Europe set for 2020, that would sit well with a release in Australia the following year.

Volkswagen Australia has been approached for comment and we will keep you updated.

Update: While VW Australia cannot confirm anything definite just yet, a spokesperson for the carmaker said in a note via email that, “the Crozz is of particular interest, and would be among the first ID models we would look to introduce.”