Industry body calls for feebate scheme

The Motor Industry Association (MIA) is calling on the government to introduce a feebate scheme to accelerate the uptake of low-emissions vehicles.

Chief executive David Crawford says the MIA and its members are strong supporters of having effective policies to encourage the reduction of carbon dioxide (CO2) emissions from transport. 

“Policies that influence demand by incentivising the adoption of low-emission technologies are effective tools so long as those policies are implemented in a way that addresses the price premium those vehicles have,” he explains. 

Crawford, pictured, notes that because the distribution of new vehicles in New Zealand is a derived-demand model, “a well-designed feebate scheme incentivises change as it influences the purchase decision”. 

“This in turn alters the mix of models supplied by distributors which is more influenced by what is bought, and therefore restocked, than policies aimed singularly at limiting supply,” he adds.

“Low-emission technology is expensive so policies that address low-emission vehicle affordability are likely to be the most effective tools available to government.”

The MIA says a feebate policy, where vehicles with high emissions attract a penalty fee which then becomes available to vehicles with low emissions to reduce their cost, helps to make these vehicles more affordable. 

Labour has made a commitment to a clean car standard that will mean new and used car imports can only produce an average of 105g of CO2 per kilometre.

A feebate scheme, championed by the Greens as an adjunct to a clean car standard, was proposed under the previous government but mothballed because of opposition from NZ First.