EV market wakes up, a little – as some new electric vehicle prices slashed in half

The industry's pain is buyers' gain, with recession, high interest rates, the elimination of the Clean Car Discount and the introduction of Road User Chargers stalling demand for EVs - and stoking killer deals. Photo / 123rf

New vehicle sales, including EVs, ticked up a little in August, providing a sliver of hope after what’s been a horror year for the industry.

And it could perk up further, thanks to electric vehicle price-slashing that could be enough to quash buyer objections about recession, high interest rates, the elimination of the Clean Car Discount and the introduction of $76 per 1000km Road User Charges, which more than doubled an EV’s annual running costs.

“There are some extremely good deals out there on EVs at the moment. So if anyone is in the market, now is the time to buy,” said James Walker, a spokesman for EV lobby group Drive Electric.

“The Nissan Leaf is being sold at $29,990. This is the first time we think a new EV has been sold under $30,000 in New Zealand,” Walker said.

The run-out deal on 2023 demo models – with the Leaf 39KWH for $29,990 and the 59KWH model for $36,990 – compares to the new Leaf starting at $49,990 and the Leaf e+ from $56,990.

“There are great deals on the Fiat 500E, VW ID range, BYD, Polestar and many other brands,” Walker said.

An Auckland man weighing his options for a brand new EV told the Herald he had wanted the electric version of the Mini but thought it was out of reach – until he was offered a $76,000 configuration for $43,000.

Tesla, which has been in a global price war with Chinese giant BYD, has slashed its New Zealand financing rate from 8.90% to 1.99% on select Model Y inventory.

Peugeot is offering its E-208 ($49,990) with financing from $135 per week.

And while the days of an $8000 rebate from the Government are gone, there are various efforts to replace it.

Those include a $5000 cashback deal on an already discounted 2023 Polestar 2, taking its price to $54,990. During the EV boom last year, the same model would have cost you $79,990.

“Much of this pricing activity is being driven by the unfavourable economic and policy environment and the desire to reduce stock,” Walker said.

Earlier, Motor Industry Association head Aimee Wiley said the shifts in policy between Governments had made ordering tricky for dealers, given manufacturing and logistics timeframes meant they had to decide how many vehicles to order six months or more in advance.

Backlash

But as much as the discounts have thrilled new EV buyers, they’ve angered some recent purchasers.

“As someone who purchased the Fiat 500E at the original price of $59,990, I’m beyond disappointed by Fiat’s decision to drop the price to $34,990. This drastic $25,000 reduction has effectively slashed the resale value of my car, making it feel like a worthless investment,” a customer told the Herald.

Smaller share of a slower market

“In August, 11.8% of New Zealand’s new passenger cars sales were EVs (BEVs, or battery electric vehicles - and PHEV, plug-in hybrids). This was similar to last month. After a tough year, it’s pleasing to see EV sales hold above the 10% market share figure,” Walker said.

“For context, 9.3% of new passenger cars have been EVs for 2024 so far, which is down from 27.2% for all of 2023.

“At the end of 2023, we had about 104,000 EVs on our roads. That figure is now just over 110,000 EVs.”

The Motor Industry Association said August 2024 was a nose ahead of August 2023 after surge in orders by rental firms.

But on a year-to-date basis, 2024 registrations are down 18.7% or 18,846 units compared to the same period in 2023.

Total new vehicle registrations for August were 13,277, according to data published by the Ministry of Transport data – well shy of August 2023’s 13,622 but ahead of last month’s 12,404.

New EV registrations were 638 for August, ahead of the 617 recorded for July, if still well down on August 2023′s 1404 (which was itself something of a hangover, by 2023 standards, after a tweak to the Clean Car Discount saw EV sales top 3000 in June last year).

Hybrids crept up from 6473 in July to 6511 sales in August.

Sales of plug-in hybrids (whose owners get the double whammy of petrol tax plus Road User Chargers, if at the reduced rate of $38 per 1000km) fell from 332 in July to 318 in August (hover over the chart above for more trend stats by fuel type).

In research released earlier this month, Fitch-owned BMI forecast New Zealand’s EV market would remain slow for the rest of the year, to finish with two-thirds (or 10,737) fewer electric vehicles sold than 2023.

Fitch-owned BMI sees an expanded charger network, Chinese competition and a narrowed price gap with petrol cars driving a big comeback in EV sales from next year.

But the firm also predicted a steady pick-up from next year onwards, driven by keenly priced new models from BYD and other Chinese brands, the introduction of electric utes and passenger EVs reaching price parity with petrol car and diesel cars.

Today, an EV costs around $20,000 more than an equivalent ICE model, and the end of range anxiety looms as charging networks expand and charging gets faster.

During a recent trip to Auckland, San Francisco-based venture capitalist Pat Knealey said Kiwis didn’t know how lucky they were to able to pick up a cheap BYD electric car.

In the US, the Biden administration, building on the Trump White House’s lead, increased the tariff on Chinese-made EVs to 100% earlier this year, while in July the EU introduced tariffs of between 17.4% and 37.6% (varying by model) on EVs imported from China.

Top selling EVs, August 2024

1. Tesla Model Y: 116 new registrations

2. Nissan Leaf: 59

3. MG 4: 39

4. BYD Atto 3: 36

5. BYD Dolphin: 28

6. Kia EV9: 28

7. Volkswagen ID.5: 24

8. Volkswagon ID.4: 24

9. Skoda Enyaq: 21

10. Ford Mustang Mach-E: 17

EV list via EVDB.nz

Chris Keall is an Auckland-based member of the Herald’s business team. He joined the Herald in 2018 and is the technology editor and a senior business writer.