As electric vehicle sales surge, Richard Denniss urges an end to the 'EV culture war'

With demand for electric vehicles surging, Australians are being urged not to let culture wars over “woke” EVs and “big dumb utes” dictate their choice of car.

Australia has recorded its strongest quarter yet in electric vehicle sales, with the latest figures showing sales of new battery electric vehicles (BEVs) more than doubling, and hybrid sales reaching a record high in the three months to June 30.

“People are buying them in record numbers right now because petrol prices have gone through the roof,” said the Australia Institute’s co-CEO Dr Richard Denniss.

The ongoing war in Iran and closure of the Strait of Hormuz – a critical crude oil shipping route – saw the price of unleaded climb to a record high of $2.53 per litre, while diesel hit almost $3.20 per litre.

“They’re getting a lot cheaper, there’s a lot more of them … and they meet more and more people’s needs,” Dr Denniss said on his podcast What’s the Point.

The latest quarterly data from the Australian Automobile Association showed that about one in five new cars sold was fully electric, increasing its market share from 12.25 per cent to more than 21 per cent over the first half of the year.

Dr Denniss said while the figures were promising, most cars on Australian roads still run on petrol and diesel.

However, he argued the uptick in EVs and hybrids was contributing to the nation’s fuel security.

“Even though we just went through this energy crisis thanks to Trump invading Iran and most Australians paid more for petrol, we didn’t run out of petrol,” he said.

“We didn’t have to queue for petrol. We didn’t have to ration petrol, that’s for sure. And the more people driving electric cars, the less people in petrol need to worry about running out of petrol.”

The economist said the figures should put an end to the culture war over electric vehicles that dominated headlines in the lead up to the 2019 election.

Then Prime Minister Scott Morrison accused then-Labor leader Bill Shorten of wanting to “end the weekend” by introducing a target of 50 per cent of new car sales being electric, saying EVs are “not going to tow your trailer”.

“It’s not going to tow your boat. It’s not going to get you out to your favourite camping spot,” he said.

Dr Denniss said it was a political strategy designed to encourage people to “pick teams”.

“The ute was this statement of kind of masculine intent of the intimidating size and power of these things was everything that a Lycra clad cyclist hates and that a woke inner city latte sipper hates,” he said.

“He was just trying to remind different groups in Australia that they don’t like each other and obviously that is not a very good way to win elections because Scott Morrison was wiped out.”

Deputy Liberal leader Jane Hume said the latest figures show government subsidies on EVs, introduced in 2023, had “run out of control”.

“I think that’s the market speaking with its feet, and probably why we don’t necessarily need more subsidies on electric vehicles,” she said.

“Unfortunately, the subsidy program that’s been run by this government has run out of control and it’s costing Australians more and more.”

The Albanese government introduced the fringe benefits tax exemption at the start of 2023, making it thousands of dollars cheaper to buy an electric vehicle.

The scheme proved far more popular than the government expected and, by May, was forecast to cost $1.35 billion this year alone, well above the initial estimate of $90 million.

In its latest budget, the Labor government announced it would be slowly winding back the subsidy from April 2027, saving $1.7 billion over five years from 2025-26.

“In the short term, Jane Hume is slightly right, but she’s strategically silent about the enormous subsidies for those big utes that for some reason the National Party seems to love.”

Dr Denniss said if the EV discount was scrapped, the subsidies on those “big, dumb utes” should go too.

“The best-selling cars in Australia today are those giant utes,” he said.

“In time, we won’t need to subsidise electric vehicles, but let’s get rid of the subsidies for the big utes either beforehand or at the same time.”

What’s the Point? with Richard Denniss explains the political and economic decisions shaping the lives of everyday Australians lives, answering key questions along the way. By getting straight to the point, Richard helps listeners understand how democracy works and why it matters.