Registrations for light electric vehicles plunged in January and were again slow in February – the second month of sales with the clean car discount gone, and road user charges for EVs confirmed from April
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Kirsten Corson, founder of carshare firm Zilch and now chairwoman of EV-promoting non-profit Drive Electric, told the Herald a lull was always expected, given the 53 per cent jump in EV sales in December as buyers raced to beat the end of the rebate.

But she said based on her group’s conversation with dealers, March would be slow, too.

After elimination of the clean car discount carrot on December 31, a stick is about to hit.

EV owners will lose their exemption from Road User Chargers from April 1, $76 per 1000km from April 1, plus $12.44 to $13.71 in admin fees for every pre-paid block of mileage, with plug-in hybrid (Phev) owners paying $53 per 1000km.

“EVs are still cheaper on a total cost of ownership model, but the current structure with RUCs – with EVs paying more than petrol – will definitely deter consumers and businesses from going electric,” Corson said.

EECA’s rule of thumb is that it costs the equivalent of 40c a litre petrol to charge an EV at home. RUCs will now be added to the equation.

The Automobile Association (AA) says the average Kiwi driver clocks up 12,000km a year, meaning $912 a year in road user charges for the average EV owner.

EV advocates have complained a fuel-efficient petrol car pays about $511 in petrol tax for the same distance.

Corson said the Government could reanimate EV sales by addressing this disparity.

Her group would also like to see rebates or another mechanism used to encourage owners of light commercial vehicles to go electric.

Many vans used in business clock up around 40,000km a year, Corson said, but the segment had gone under the radar with incentive schemes so far. Heavy vehicle owners should be incentivised to go electric, too.

On the back of the clean car discount (CCD) of up to $8625, the number of new EVs on New Zealand’s roads jumped from 27,499 at the end of 2022 to 73,067 at the end of 2023.

December last year was the peak of the CCD frenzy, with 3469 new EVs registered.

In January, that fell to 448. In February, 482 new vehicles were registered.

Some 265 new plug-in hybrids were registered in February, from 202 in January and 987 in December.

Tesla Model Y (145 registrations) topped the subdued February EV chart, followed by the BYD Atto 3 (25) and the Ford Mustang Mach-E (20).

New incentive on the way

Earlier, Transport Minister Simeon Brown said the RUC exemption was always set to expire once EVs formed 2 per cent of NZ’s fleet.

The previous Government had pencilled in the April 1 transition date, which was then confirmed by Brown.

The Government planned to subsidise 10,000 public chargers by 2030 as a new mechanism to encourage electric vehicle uptake. Details of the scheme are pending.

And although the clean car discount was wiped for consumers, the previous Government’s Clean Car Standard had been maintained.

The CCD sees importers incur charges on higher-emission vehicles, but these can be offset with credits for importing lower-emission vehicles, too.

Brown favours ultimately expanding RUCs to all vehicles as the Crown seeks to maintain road maintenance funding – about half of which is currently generated from fuel tax – as NZ’s fleet electrifies.

The ABCs of RUCs

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.