Are electric cars really the future of New Zealand transport?

Are electric cars really the future of New Zealand transport? A group of enthusiasts think so and are driving the length of the country to prove it. Geoff goes for a test drive in a fully electric Nissan Leaf with one of these enthusiasts – Sigurd Magnusson.

The Transport Minister Simon Bridges has promised a package of incentives to improve the uptake of electric vehicles, but this is long overdue. As Sigurd discusses in the video, the main barrier to increased uptake is the high purchase price. Once purchased, the electric vehicle is far cheaper to run, but this probably won’t persuade Kiwis in the short term as they are used to buying very cheap second (or third) hand petrol powered cars. A higher price on emissions will only make a small difference to the price of petrol – especially compared to the movements in the oil price.

Other countries have created incentives for electric vehicles, most notably Norway as mentioned in the video. A range of options are discussed in this paper. Should New Zealand be following suit? It is hard to say; we certainly need a plan for reducing our transport emissions, but until the Ministries for Environment, Transport and Business do some analysis on the issues it is hard to know what the most cost effective way forward is. EVs might be the answer, or perhaps we should be putting more money into Kiwirail to take more off the freight of the road.

A lot depends on what happens to the cost of electric vehicles, but there are signs the cost is dropping faster than most predicted. In the days since recording this video global electric car leader Tesla has stunned everyone by announcing it is bringing their next generation electric car the Tesla 3 to New Zealand. The exciting things about the Tesla 3 are the relatively low price – US$35,000 (around NZ$50,000) – and the much larger range of over 300km. This new car got 325,000 orders globally in its first week – and yes, Sigurd was one of them.

I wonder if Sigurd wants to sell his Leaf now?

Geoff Simmons is an economist working for the Morgan Foundation. This post first appeared on Gareth's World.

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