The Hon Catherine King MP
Press Conference, Parliament House
CATHERINE KING: Thanks very much, everybody. Just being aware there is going to be a division, it's a proper division, so one of us will go and come back, so we'll just see how we go.
Thanks very much for coming this afternoon. Alongside Minister Bowen, I'm joined here today with representatives of Toyota, of Hyundai, of the Motor Traders Association and the Dealers Association, the Electric Vehicle Council and also Tesla.
Well, we'll be introducing legislation tomorrow for a new vehicle efficiency standard for Australia. It will be giving Australians who are buying a new car more choice of cheaper-to-run vehicles, whether those vehicles are petrol vehicles, diesel vehicles, hybrid vehicles or electric vehicles, realising substantial fuel savings for Australian consumers; $95 billion of fuel savings up to 2050.
You'll still be able to buy the vehicles you know and love, but there will be more options of more efficient vehicles available in the Australian market.
With no action we know that transport emissions are expected to become Australia's largest source of direct emissions by 2030, 60 per cent of transport emissions come from the cars that we drive. We are proposing to reduce those emissions by half.
This is an Australian standard for Australian consumers and Australian conditions. We have consulted widely and for some time to get the model right for Australia, one that does increase choice, it reduces emissions, is sustainable and effective, and realises fuel savings for consumers.
We've responded to practical suggestions and a limited number, as I've said, we've responded to practical suggestions, and they are; a limited number of four-wheel drives, such as the Toyota Land Cruiser, great vehicle, Ford Everest, also a great vehicle, regarded as workhorse four‑wheel drives, will move from the passenger car into the light commercial category.
We're smoothing the emissions trajectory for light commercial vehicles. The new vehicle efficiency standard targets for passenger vehicles catch‑up to comparable economies by the end of the decade. We're adjusting what is known as "the break point", recognising heavier vehicles emit more. It also means that EVs, which are heavier due to their battery than their petrol or diesel counterparts, can also earn more credits.
The standard itself will begin on 1 January 2025, but the credits and penalties system won't start until 1 July next year, and that is to help my department with the implementation.
Can I thank very much the industry for the collaborative and cooperative way in which they've worked for us? We know that working together we get better policy outcomes, and that is what this has been about. When we launched the impact analysis, which is part of the regulatory process, we said we would consult, and consult we have, and what you see is a result today, is a result of that consultation.
This is a policy that has been around for a quarter of a century. 2001, the then Prime Minister John Howard, said that they were negotiating a fuel efficiency standard. Well, the Coalition has backed away, failed to get it done. Labor is actually delivering a fuel efficiency standard for this country.
The Coalition, we know, will just resort to scare campaigns, but we take a very different approach. We've worked a long time to get this to here. This is a long-needed change for the Australian market. It is an efficiency standard that is right for Australia, and we certainly, as we introduce and start to go now through the parliamentary processes, urge all other political parties to get on board.
Minister Bowen.
CHRIS BOWEN: Thanks so much, Catherine, and can I also thank you for your leadership and the very close way we've worked together over recent months to make this policy a reality.
This policy is sensible, but long overdue; been promised by governments for decades, but this Government will be the Government that delivers it. And as Catherine said, we are joined today by a broad cross-section of the motoring industry, and just as a broad cross-section of the motoring industry has engaged with us, it's now time ideally for a broad cross-section of Parliament to pass this legislation.
This legislation will mean Australian motorists are no longer at the back of the queue, no longer treated as second‑class citizens, but are given the same rights as those motorists and consumers in 85 per cent of the world's car markets, and no longer will Australia be in the G2 of Australia and Russia as the only two major economies without vehicle efficiency standards.
Now as Catherine said, we announced our preferred model in February, we said we'd consult with parties with good faith on implementation details, on the finer details; we said we'd take on board sensible, good-faith suggestions, and that's exactly what we've done.
Not everybody here has got everything they've asked for. Some people wanted us to go harder and faster; some have concerns - had concerns and wanted us to slow. But everybody here today has had a say, everybody today's had genuine concerns taken on board, and everyone today recognises that Australia can now move on, implement these standards, and Australian motorists can get access to these standards.
In addition to the changes Catherine announced, in my portfolio, I'm also announcing $60 million of support for Australian car dealers on charging. We recognise, not just in terms of Australian car dealers making a very big transition to EVs and hybrids, having chargers available to charge the cars in their stock, but also being able to provide a charging option for their customers going forward after purchase is a good thing, and that $60 million will be available in a competitive process, and of course we'll encourage and have [indistinct] towards those dealers that make the charging available to consumers and motorists more broadly.
But it's great to be joined by this broad cross-section of the motoring industry, to be joined by Tesla and Toyota. It reminds me of when the Prime Minister and I notified the UNFCCC of our 43 per cent emissions reduction target, with the Business Council of Australia and the ACTU behind us, with the conservation movement behind us, as well as industry groups. This is to try to bring groups together, and that's what we've done today. I’m going to ask Matt Callachor, the CEO of Toyota to say a few words, then Behyad from the EV Council, and then we'll take questions.
CATHERINE KING: And I'm just checking, one of us has to go to a division, we need one, so I'll do, and then come back.
CHRIS BOWEN: Okay, I'll do the next one, Catherine. Matt, you come in here.
MATTHEW CALLACHOR: Thank you very much. Look, firstly, I have to say this, it really has been Toyota's position for quite some time that we wanted an emissions standard to basically help us with long-term product planning and where we're going. We wanted an emissions standard that's basically ambitious, but also brings people on the journey and doesn't leave people behind, which is where we are.
We appreciate the fact that the Government has given us an opportunity to have a voice to all parties and to be able to be consultative, and we think the amendments that are being made, we support the Government in the amendments that are being made. I think they're a positive step forward.
But we shouldn't be under any illusions that there still remains a very big challenge in achieving these ambitious numbers, particularly as we look well into the future from that perspective.
But the reality is we just simply need to get on with it now and move forward. Thank you.
CHRIS BOWEN: Thanks, Matt. Behyad.
BEHYAD JAFARI: Thank you. It is certainly a great day for Australia, introducing long‑overdue and strong vehicle efficiency standards. But this is something that our industry has been working towards over several decades, long before I've been here, and you've heard a lot of voices from Tesla to Toyota, everybody wants these standards in place so that we can get on with the planning of providing Australians with lower fuel bills and a greater choice of, particularly, the most efficient, latest and greatest electric vehicles. It is Australians who will benefit out of this move, and I'd like to repeat my colleague's thank you to the Government for working so constructively right across the industry.
This is certainly not a divisive issue, this is an issue that our entire industry wants, and finally, after decades of work, has. Thank you.
CHRIS BOWEN: Over to you guys.
JOURNALIST: Minister Bowen, just a question for Matt from Toyota.
MATT CALLACHOR: Sure.
JOURNALIST: You just said there's still a big challenge. Are you sure you'll be able to, in terms of continuity, still offer Toyota customers vehicles, in terms of the Hilux, and so forth, that will be ‑ have the same capability and range as the current model as you transition through this, for the same price, or do you think one of those will have to give?
MATT CALLACHOR: I think, you know, key to this, as I said, we were looking for something that was ambitious, but also would bring Australians along in the journey. And as I said, that does leave a challenge, a significant challenge.
But I think, basically from our perspective, is we want to continue to be able to provide vehicles that people actually see fit‑for‑purpose, and in conjunction with that, involve the technology developments over this journey over the next years coming, and it is a journey as we get there.
You know, in summary, we basically, as Toyota, want to be able to offer practical, capable and affordable vehicles.
JOURNALIST: Do you think you can provide that level of continuity whilst it's -
MATT CALLACHOR: That's our aim, to actually work our way through this, and as I said, it will be difficult. So ‑
JOURNALIST: Can I ask a question on that? Given that Toyota manufactures millions of vehicles already that meet these standards, what's the problem?
MATT CALLACHOR: Well, I think the first thing is in recognising actually the areas that the Government has addressed, particularly in the commercial vehicle area that we're talking about here, the technology's yet to actually be at an affordable price, also providing fit‑for‑purpose at this very second.
So the Government has recognised that with a number of amendments, so that the transition and journey, as we progress through the next years, will offer that opportunity to actually make sure we don't leave people behind.
JOURNALIST: Is this a ute tax?
MATTHEW CALLACHOR: As I said, our intention is that there is still a challenge within this, but our intention as we look forward is to basically offer practical, capable and affordable vehicles.
JOURNALIST: Is it a tax or not?
CATHERINE KING: No, no.
JOURNALIST: Is this policy a ute tax or not? That's my question to you.
MATT CALLACHOR: No, the actual policy is directed at reducing overall emissions in the economy.
JOURNALIST: Can we turn to the representative for Tesla?
SAM MCLEAN: Yes.
JOURNALIST: The fact that your company exited the Federal Chamber of Automotive Industries over this, are you happy with the end result as it has come out today?
SAM MCLEAN: Look, the end result that the Government's landed on here is a compromise between all the folks that you see up here on the stage. As Minister Bowen said, nobody has left with everything they wanted, and this is a very moderate standard that takes Australia from being really the last place in this transition to the middle of the pack, and in doing so, it will save motorists thousands of dollars on petrol, and it really gives Australia an opportunity to make good on a great gift that we have as Australians, which is that Australia has the best reserves of minerals for electric vehicles anywhere in the world, and every single additional electric vehicle sold is to the benefit of the Australian economy. So I think it's a very solid compromise; it does a good job for Australia.
JOURNALIST: Minister Bowen, a challenge in places like the US has been with demand not being where it was expected, even with things like subsidies to entice people into electric vehicles. Has the Government done any modelling on how you're expecting demand for these vehicles to change in Australia as these cuts come in, and what does it say?
CHRIS BOWEN: Well, I just say this, Clare. EV demand is very high across the world; I read some stories to the contrary, but EV demand remains very strong. This is not just about EVs, it's also about hybrids and more efficient petrol and diesel vehicles, as Catherine and I have consistently said for a long period of time, and the peak industry group in their submission to us said that they expect a big increase in EVs to be brought to Australia under business as usual.
What we've sought to do is ensure that we require Australian motorists to have choice. No, we haven't ‑ we don't have a target for EV take‑up, we believe Australians have choices, and they should be given better choices.
JOURNALIST: Minister though, the US targets that we're seeking to align to by [indistinct] says we want about half new car sales by ‑‑
CHRIS BOWEN: And that's what the FCAI have said they expected to happen. Jacob.
JOURNALIST: How many EVs do you think will make up the market by the end of this 2030, and secondly, what's your message at this point to the Greens on this, given they've indicated that this is kind of hostage to the gas ‑‑
CHRIS BOWEN: Well, the answer to the first question, Jacob, is that's up to Australian motorists. We are not providing a target or a mandate. Some other ‑ manufacturers are making their choices about when they'll stop making internal combustion engines and some other countries are going [indistinct] but we're not ‑ I believe in choices, and a number of people say to me, "I want my next car to be an EV or a hybrid, but I don't feel there's a range at the moment," this is what's designed to deal with that.
Now in relation to the second question, this has been a reform in the too‑hard basket for 20 years. We put it on the to‑do list. We'll be putting it to the Parliament.
I don't want to speak for climate groups, but we've been liaising with climate groups and consulting with climate groups, and they strongly support this being legislated, and I would think it would be surprising if the Greens stood in the way of what is important climate-related legislation, as well as legislation which brings better choices for Australians.
JOURNALIST: To all the manufacturers, anyone see prices going up because of this?
MATT CALLACHOR: As I was saying a little earlier, this still remains a significant challenge, as we look ahead. But in terms of, we want to actually be able to offer people, and bring them on this carbon reduction journey over a period of time, and basically not compromise them on the areas of fit‑for‑purpose as it does that.
Australia is an extremely competitive marketplace in which we exist, and you cannot afford to be mispriced, otherwise you're basically not going very well at all.
So from our perspective, we want the vehicles to be basically practical, capable and affordable.
JOURNALIST: If I could ask just a question, I did come late, so please correct me ‑‑
CATHERINE KING: Of course.
JOURNALIST: Is there a representative from the AAA or FCAI here?
CATHERINE KING: No.
JOURNALIST: No. So I just wanted to ask why is that you mentioned like having everyone sort of just in the discussion, and so on, that they're not here, and when you met on Thursday. And why the need for such, you know, secrecy last Thursday, [indistinct] can you just describe a bit of that process?
CATHERINE KING: Yeah. So the first thing is that in order to make sure that we have the right model for Australia, we've had to engage directly with manufacturers, because the data that they have about the models they have, the models they're bringing into market, what their intentions are in terms of the Australian market is highly confidential, and it's not something they at all share with each other; many of them were very reluctant to share it with us, and that's why it was really important we kept that confidence, but we needed that data in order to make sure that we had the model right for the Australian market and the intentions of the manufacturers for that.
And that's really why we've engaged with the manufacturers directly, engaged with the dealer representatives directly, and that's what you see as a result of the model that we've got here today.
JOURNALIST: And the AAA and FCAI not being here, can you tell us a bit about what that ‑‑
CATHERINE KING: You'd need to ask them.
JOURNALIST: Can I say, there is a review for 2026, as I understand.
CATHERINE KING: Sure.
JOURNALIST: Does that mean that if it doesn't quite go to plan you would be prepared to adjust things if need be?
CATHERINE KING: Well, what you ‑ you know, what you always do. I mean this that you're seeing before you is an example of very good policy making, you know, this is not Chris and I's first rodeo when it comes to being Cabinet Ministers. This is how you make policy: impact analysis, consultation, calibrate, and obviously, the review is to ensure that it is working.
You know, this has a policy intent. We want to get fuel savings for consumers, we want to absolutely make sure we get choice in vehicles for the Australian market, and we want to also make sure we get emissions down at the same time as making sure that Australians can still continue to buy the cars that they love and use currently.
JOURNALIST: Minister King ‑‑
CATHERINE KING: Yes.
JOURNALIST: ‑‑ there's been a number of cars moved out of that EV [indistinct] ‑‑
CATHERINE KING: Yes.
JOURNALIST: ‑‑ has the biggest category into the LCVs category. Given those cars have been moved out, can you afford to move more aggressively on the passenger vehicles emissions reduction?
CATHERINE KING: The way in which we've done that is obviously, and it's the chassis base that they've used that we've calibrated to move them into, you know, they're more the workhorse type of vehicles, and used for that purpose. Obviously they need the sort of torque for towing in terms of that, and that's really what we've done, provided that pathway, while keeping the headline limit for passenger cars the same as we had with the option B.
JOURNALIST: But you can't move more aggressively on the ‑‑
CATHERINE KING: No, we think that's the right model for that, and again, that's been part of the consultations.
JOURNALIST: Is there potential for any further moves to reduce emissions in the transport sector or for the foreseeable future, is that a ‑‑
CATHERINE KING: Overall, I mean, obviously this is an emissions, that focuses on cars as a substantial amount of the transport emissions, but as you would have heard, Minister Bowen has carriage alongside a range of portfolio ministers for a series of sector plans, and there is one that has been consulted on in my portfolio. Obviously, there are hard-to-abate sectors in transport.
Aviation is a really hard-to-abate sector, sustainable aviation fuel the solution there. Heavy vehicles, also a hard-to-abate sector, we're starting to see, certainly in that sort of last mile a lot of electrification happening there, but what we're also starting to see is in the heavy vehicle sector some really good options around renewable diesel, around batteries; maritime is exactly the same and rail is also a good option, but also a hard‑to‑abate sector. So roadmap will be out shortly. We're going to have to finish up shortly, but I'll just take one more.
JOURNALIST: Minister King, all the industries behind the most popular cars in Australia are large utes or SUVs. Do you see that changing over the time between now and 2030 and do you see a role as helping to shift that, like is the Government trying to influence the cars Australians buy?
CATHERINE KING: I think that you'll see, you know, Australians love those. I'm a regional MP, I've got a diesel vehicle that I drive myself, I tow a 1972 Franklin caravan. I know that in order to drive it, it's really heavy, it is a really heavy thing to tow, but we are seeing a whole range of technologies come in.
I was out last week with the caravan industry, there's a manufacturer who's actually making caravans that are self-propelling, so got batteries in them themselves, you don't actually need the towing capacity. We're going to see a whole range of changes to technology, but what this does, what this emissions standard, efficiency standard does is actually ensure that Australians can still buy the cars that they have love, as we incentivize more efficient cars; whether they be petrol, whether they be diesel or hybrid or electric, into the Australian market. Thanks very much everybody. Thanks so much.