Have you ever looked at buying an electric vehicle (EV) or plug-in hybrid electric vehicle (PHEV), but found them a little too much for the budget? You’re not alone. According to latest statistics from the Electric Vehicle Council, EVs represented just 8.45% of all new car sales in Australia across 2023 – yet this is a positive trend and showcases a 120% increase compared to 2022.  More EVs and PHEVs on the road means less carbon emissions and more energy-efficient transport, but Australians have been slower generally, to make the switch.

The Electric Car Discount Introduction

Recently the government unveiled Australia’s first National Electric Vehicle Strategy, geared to get more EVs on Australian roads. As part of this strategy, Australians have access to the electric car discount program - a set of initiatives and discounts to encourage drivers to make the switch to EVs and PHEVs. But this program isn’t as simple as a straightforward electric vehicle rebate.

In this article, we’ll dive into the details of the electric car discount, so you can see how it could help you.

What’s included in the Electric Car Discount?

The electric car discount aims at making EVs cheaper for Australians. The discount also applies to PHEVs until the end of 2025. Here are the key financial incentives included the electric car discount:

  • Import tax cuts: The discount has removed the 5% import tariff on EVs priced under the luxury car threshold, which could save up to a maximum of $2500 on a car. Along with this, the luxury car tax threshold for low-emissions vehicles has been raised to $89,332 for the 2023-24 financial year and beyond, making a greater range of EVs and PHEVs import tariff free.
  • FBT exemption: Cars purchased under employee salary-sacrifice arrangements, or via company fleets, are now exempt from FBT. The Electric Vehicle Council estimates this could save companies up to $10,000 per car, and employees between $3000 and $5000 depending on their circumstances.
  • Greener car loans: The CEFC is investing up to 40 million into green car loans, which provide a loan with a low interest rate that can be used to purchase an EV with a cost under $90,000. This discounted finance is estimated by the CEFC to save purchasers between $1400 and $2500 compared to market rate car finance depending on the length of the loan.

These incentives add to existing electric vehicle rebates that already exist in almost every state and territory and can be as much as $6000 depending on your location.

What else is the National Electric Vehicle Strategy doing to help with EV and PHEV adoption?

Discounts on EVs and PHEVs are just part of the picture in getting more of these vehicles on the road. The National Electric Vehicle Strategy also aims to make electric cars desirable to drivers in a range of other ways:

  • National EV Charging Network: Even the best EVs are limited without somewhere to charge. The charging network aims to install EV and PHEV charging infrastructure at 117 sites on major highways at an average interval of 150km. The government is also developing a national mapping tool for EV charging points so you can see where to recharge.
  • Fuel-efficiency standards: With the introduction of the New Vehicle Efficiency Standard (NVES), The government has legislated new fuel-efficiency standards for all vehicles that will encourage more EVs and PHEVs to be sold. The aim of the implementation for this efficiency standard is to reduce emissions from new passenger vehicles by more than 60 per cent by 2030, and roughly halve the emissions of new light commercial vehicles over the same period.
  • Australian Made Battery Plan and National Reconstruction Fund: While not directly targeting EVs and PHEVs, these initiatives fund Australian battery production and low emission technologies which together aim to make more EVs available for purchase at a lower cost.

Electric car discount benefits

The electric car discount is expected to bring a range of benefits to Australia, as well as drivers themselves. Here are some of the goals that the discount hopes to achieve:

  • Reduced carbon emissions: Transport is Australia’s third-largest source of greenhouse gas emissions, so getting more EVs and PHEVs on the road represents a great opportunity to reduce emissions. This will help meet the government’s emissions reduction target of 43%, and net zero emissions target by 2050.
  • More affordable EVs and PHEVs: Lower taxes and FBT exemptions make EVs and PHEVs more affordable for those looking for a new car. This adds to the average fuel savings of up to $2000 that the Electric Vehicle Council has estimated drivers of EVs enjoy each year. Read our fuel saving tips for PHEVs to learn how you could reduce fuel costs.
  • Energy Independence: As green electricity expands, EVs and PHEVs can be charged with renewable energy, reducing Australia’s dependence on imported oil and fossil fuels.
  • Investment in Technology: The investment of the wider strategy into Australian technology contributes to local innovation and industry.

This incentive program will accelerate the adoption of electric vehicles in Australia, especially within company fleets. As a result, there will be a substantial rise in the availability of second-hand EVs for all Australians, offering a more affordable alternative to new EVs.

Electric car discount challenges and considerations

While the electric car discount has a range of benefits for individual drivers and Australia as a whole, it also faces several challenges:

  • Demand for EV infrastructure: As more Australians drive EVs and PHEVs, the demand for charging stations and other EV infrastructure will continue to increase. While the government plans to expand the national EV charging network along major highways, this may take some time to achieve in practice and may not cover all areas.
  • Electricity grid capacity: If EVs become a major form of transport for Australians, this may place more demands on the electricity grid. Local authorities will need to upgrade the electricity network to cope with these new requirements. In-home charging technology may also need to be improved to allow for technologies such as smart charging outside of peak times to help with demand.
  • Education and Awareness: The widespread adoption of EVs will also require public education and awareness, to dispel myths and misconceptions about EVs. Australians also need to understand how to charge and use their EVs and PHEVs for the greatest energy savings.

PHEVs like the Outlander Plug-in Hybrid EV and Eclipse Cross Plug-in Hybrid EV fall under the electric car discount until April 1st, 2025, making now a great time to consider a Mitsubishi Plug-in Hybrid. Find a dealer to book a test drive and try our PHEVs for yourself.