CEFC finance drives down green car loan cost to accelerate Australia’s EV uptake
28 November 2022
CEFC finance will help get more Australians on the road to owning an electric vehicle (EV) with a commitment of up to $20.5 million to make green car loans cheaper through Taurus Motor Finance (Taurus). The commitment from the CEFC will support an estimated $100 million of green finance for Australian consumers to purchase EVs.
Eligible borrowers will receive discounted interest rates on green car loans, compared to the rate for internal combustion engine powered (ICE) vehicles. The investment has the potential to accelerate the uptake of EVs and drive decarbonisation of the emissions intensive transport sector by tapping into growing demand in Australia for EVs. It will further influence the Australian finance sector by demonstrating the value of green car loans.
CEFC Head of Debt Markets Richard Lovell said: “Australia faces a significant challenge to decarbonise its economy. The transport sector is the third largest source of national greenhouse gas emissions1 and our efforts to get to net zero emissions by 2050 must include a focus the way we travel.
“As more Australians consider buying an EV to cut their carbon footprint, more affordable finance will provide a powerful incentive to convince them to commit. Increasing the number of EVs on Australian roads will also foster the development and roll out of the smart charging infrastructure needed to support them. More accessible EV chargers will in turn encourage more people to consider switching to an EV.”
Australia is well behind many other countries on the roll out of EVs and according to the Electric Vehicle Council, EVs account for just 3.39 per cent of new car sales in Australia2.
The Arcadis Global Electric Vehicle Catalyst Index 2021 ranked Australia last or near-last out of 12 countries in all criteria. Australia was the only market assessed as being poor in each category, including availability of EVs and charging infrastructure. The Index estimated that in 2030 Australia will have just 20 EVs per 1000 people in Australia, compared with 100 per 1,000 people in Italy and 120 in California.
Research shows that Australians are increasingly considering an EV purchase for their next car3. Challenges that have slowed the growth of our EV market include fewer models for sale compared to international markets4, with some popular models selling out their full annual allocation within hours of becoming available.5 The Arcadis index6 reported that Australia had just 30 EV models available, compared with 154 in Hong Kong and 100 in Norway.
The discounted green car loan offered by Taurus extends to all battery electric vehicles and high performance plug-in hybrid vehicle models under $90,000, including BYD plug-in electric vehicles through EV Direct.
Mr Lovell added: “At least half of all car buyers in Australia finance the purchase with a car loan. Working with Taurus to establish a new green car loan has the potential to improve EV availability because it offers Original Equipment Manufacturers the certainty that potential customers can access finance to buy their cars.”
Taurus founders and co-CEOs David Giffin and Satyajit Pal said: “We’re delighted to receive this support from CEFC which will support the work we are doing with EV Direct to accelerate the transition of Australian consumers to a cleaner and greener future. We also appreciate recent legislative action by the Federal Government through the Treasury Laws Amendment (Electric Car Discount) Bill 2022 and are working actively to introduce a Taurus novated lease product. We appreciate the CEFC’s support with our novated lease product.”
Luke Todd, CEO and Managing Director of EV Direct said: “Cost has been one of the biggest barriers to EV uptake in Australia. For the first time the Australian consumer has a genuine choice between and EV and an ICE vehicle and we are excited to support this green funding initiative.”
The CEFC investment further strengthens our portfolio of investments to reduce emissions in the transport sector and boost EV uptake.
To 30 September 2022 the CEFC had helped finance more than 2,300 EVs. The CEFC has also invested more than $54 million in large scale EV projects, including EV charging infrastructure through Jet Charge, replacing diesel mining trucks with battery electric systems with 3ME Technology and helping finance Australia’s first electrified bus fleet with Zenobe.
1 Quarterly Update of Australia’s National Greenhouse Gas Inventory: March 2022
2 Electric Vehicle Council, State of Electric Vehicles, October 2022.
3 54% of respondents said they would consider purchasing an EV as their next car in the Electric Vehicle Council Australia Consumer Attitudes Survey 2021
4 Electric Vehicle Council, State of Electric Vehicles, March 2022, p3
5 Ibid, p5
6 Arcadis Global Electric Vehicle Catalyst Index 2021
Media release, 2022