FCAI says low consumer demand is placing pressure on the New Vehicle Efficiency Standard (NVES) as EV manufacturer Polestar calls for the Government to stand strong.

Australia recorded 94,993 new vehicle sales during February, a drop of 9.6 per cent on the same month last year, as consumer demand remains subdued amid cost-of-living pressures.

However, according to Federal Chamber of Automotive Industries (FCAI) CEO Tony Weber, the industry was increasingly concerned at the rate of total battery electric vehicle sales, which recorded just 5.9 per cent of total sales, compared with 9.6 per cent in February 2024.

“We are now two months into the Federal Government’s New Vehicle Efficiency Standard, and while the supply of battery electric vehicles has risen dramatically, consumer demand has fallen by 37 per cent this year compared with the first two months of 2024,” he said.

“We knew the supply of EVs would increase and there are now 88 models supplied to the Australian market. However, our grave concern has always been the rate of EV adoption and what assumptions the Government had made in its modelling around consumer demand for EVs in the NVES. This modelling remains secret.

“The easy part is to set aspirational targets but without consumers demanding EVs, the NVES will not succeed. It is time for the Government to consider the realities faced by consumers.”

Meanwhile, Polestar, the Swedish electric performance car brand, is urging the Federal Government to remain committed to a robust NVES despite calls to the contrary from the FCAI.

Head of Polestar Australia, Scott Maynard, believes the comments from Weber are not helpful for the industry.

“Efforts to undermine this legislation will only disadvantage Australians,” Maynard said.

“The NVES was developed to lower vehicle emissions by incentivising carmakers to offer more hybrid, plug-in hybrid, and battery electric options, and we can clearly see car brands rising to that challenge.

“Over 85 per cent of global car markets have a fuel efficiency standard in place to deliver improved health outcomes and reduce ownership costs. We must stay the course to see these benefits realised in Australia.”