Tesla vehicles have received the largest amount of subsidies in dollar terms under the clean car discount. Photo / Getty
Tesla owners have been the big winners of the Government’s clean car discount to date, with the buyers of 9730 Teslas getting a combined total of $83m in rebates from the scheme since it began in July 2021 - averaging about $8500 a car.
This makes Tesla owners the biggest winners of the policy in dollar terms. Toyota owners were the next largest recipient of rebates, getting $71m. Regional breakdowns of the scheme show that many - though not all - of the suburbs where these cars are registered are well-known for their wealth.
The Toyota vehicles that qualified under the scheme included a variety of hybrid and low-emissions conventional cars as well as second-hand vehicles, all of which attract smaller subsidies than the $8625 maximum payout. which only goes to new, fully-electric vehicles like most of the Teslas imported into New Zealand
Figures released to National transport spokesman Simeon Brown under the Official Information Act give a breakdown of the car brands that have benefited the most under the scheme, which has had to be adjusted this Budget because it has been so successful at driving the uptake of EVs that it has nearly run out of money. The figures run from when the scheme began on July 1, 2021, to the end of March 2023.
Luxury car owners have been making use of the scheme to purchase subsidised high-end cars. Alongside Teslas, $5.1m has been paid to Mini buyers and $3m has gone to Lexus buyers.
A handful of other luxury makes also managed to squeeze into the eligibility criteria.
Nine buyers of Alfa Romeos collected $12,257 in subsidies, three Jaguar buyers claimed $10,350, and a single Porsche buyer got $2300 for their Cayenne.
The clean car discount was launched in 2021 following an unsuccessful attempt to get the scheme going in Labour’s first term.
Under the current rules, the system works by giving refunds of up to $8625 off the price of the cleanest, fully-electric new EVs when they are first registered, which is paid for by slapping a $5175 fee on the dirtiest new vehicles.
In between those two extremes, cars that are less polluting or less fuel efficient attract lower fees or lower rebates depending on how dirty or clean they are. Under the old rules, some very low emissions conventional petrol vehicles get a discount.
A similar system applies to used vehicles although the fees and discounts are smaller.
From July 1, the structure of the scheme will change to allow maximum rebates of $7015 on new cars and max fees of $6900 on polluting cars. The eligibility criteria will also tighten.
From its inception, the scheme has attracted criticism for the fact ute buyers have been subsidising the purchase of luxury vehicles such as Teslas.
Brown repeated this attack this week, noting Tesla owners were the largest recipients of discounts.
On Tuesday morning, Wood alleged this was “incorrect”.
“More money is paid out and there are far more vehicles sold that are Toyotas than are Teslas,” Wood said.
“The most amount of money has gone to Toyotas and I can absolutely guarantee you that 100 per cent,” Wood said.
On his way into the Question Time a few hours later, Wood had to clarify that since the scheme began more money had gone to Teslas than Toyotas.
However, since the scheme was extended to include more kinds of vehicles, Toyotas had been receiving more payouts than Teslas.
It is true that more individual Toyota cars have received a rebate than Teslas, roughly 38,000 compared to 9700.
Brown said he was vindicated by the clarification.
“Michael Wood didn’t want to come clean on his clean car subsidies and how much is being given to people purchasing Teslas, which I think indicates the Government is aware of the inequities of this scheme, but has chosen to ignore them whilst continuing to tax farmers and tradies,” Brown said.
Where are the subsidies going?
The Herald can also reveal the suburbs that have benefited most from the scheme using data handed over when the rebates were claimed.
All bar one of the top recipients of the subsidy are located in Auckland, and most are located in central Auckland.
The list of suburbs is not the roll call of well-heeled suburbs you might think with Manukau and Henderson bringing up the rear of the list which also includes Remuera, Ellerslie and Epsom. Brown noted that some suburbs that had large numbers of registrations could show the effect of companies registering their vehicle fleets, which are eligible for the subsidy.
Large numbers of companies and organisations have claimed the subsidy. Data from written Parliamentary Questions show more than $97m has been claimed by companies and organisations in the period to the end of February. Indeed, some car companies have been getting the subsidy by purchasing EVs, although the data does not show whether the EVs were their own. Tesla New Zealand received $327,375, and three Toyota organisations have claimed more than $2.2m.
Brown said the representation of wealthy suburbs on the list indicated the discount was a “reverse Robin Hood scheme where it is taking from people who don’t have a choice in terms of what they have to buy and giving it to people who do in terms of these vehicles”.
Waka Kotahi said the suburb to which the vehicle is registered is not necessarily where the vehicle is used.
The top suburbs outside of Auckland were Christchurch’s Harewood, the only suburb outside of Auckland in the top 10, followed by Rolleston, also in Canterbury, and Hamilton. Whitby, Karori, and Tawa were the only Wellington suburbs on the list.
The Auckland region claimed the biggest subsidies, netting $182m, followed by Canterbury on $46m, and Wellington on $42m.
Does it reduce emissions?
Wood defended the fact that some wealthy people would benefit from the scheme, noting he would “much rather have those people purchasing a zero-emissions Tesla than a huge big gas guzzler which puts out more carbon dioxide emissions”.
The scheme is partly designed to drive the uptake of new vehicles which would then be onsold to other consumers, greening the fleet overall.
New Zealand is currently experiencing a massive shift in vehicle imports, with a wave of EVs entering the country. This is likely thanks to the incentives provided by the Government’s clean car policies.
Data from Stats NZ showed that in the 12 months to March 2023, reduced emissions vehicles made up 37 per cent of total imported passenger vehicles.
Of these, 18.02 per cent were fully electric EVs.
This is well up on the year to July 2021, the 12 months before the scheme began and a year when many people took advantage of the stimulatory financial environment to buy a new car.
That year just 4.39 per cent of imported passenger cars were fully electric, and 14.54 per cent of vehicles were reduced-emissions.
The Government says the scheme’s success will reduce 230 per cent more emissions than originally estimated by 2025, and 50 per cent by 2035. This calculation includes other clean car policies.
The Herald has not been provided with an updated breakdown of this new calculation, but a Ministry of Transport paper from February notes the two main clean car policies were responsible for a fraction of the 2022-2025 emissions budget, and less than a third of the 2026-2030 budget and less than a quarter of the 2031-2035 budget.
The policy reduces emissions significantly more than the EV road user charge exemption introduced under the previous National Government and renewed under the current Government.
The emissions reductions from that policy are so slim they are barely visible in the graph of emissions reductions presented to ministers - they require significant magnification to be seen.
Expectations tempered around return to surplus in 2027/28.