Mazda Advocates for Incentives Over Fines to Boost EV Adoption in Australia
Mazda Australia has raised concerns about the current approach to electric vehicle (EV) adoption, suggesting that fines-based measures are not the most effective way to encourage consumers to switch to electric vehicles. According to Vinesh Bhindi, the head of Mazda Australia, the government should focus more on creating incentives rather than imposing penalties.
Bhindi highlighted that there is now a wide range of EV options available in the market, covering various price points and sizes. This variety suggests that the issue lies not with the availability of choices but with other barriers that need to be addressed. He emphasized the importance of understanding and supporting consumers as they transition to electric vehicles.
One of the initiatives currently in place is the battery subsidy, which allows individuals with solar panels to capture energy and use it for home charging. This makes sense from both an environmental and economic perspective. However, Bhindi believes there needs to be more and different initiatives to support demand.
He pointed out that the fringe benefits tax (FBT) incentives are under review, and he questions the decision to eliminate them entirely. While the FBT may need to be restructured, Bhindi argues that there should still be some form of incentive to encourage EV adoption. It doesn’t have to be FBT, but something else that can provide similar benefits.
The charging infrastructure is another area that requires attention. Bhindi noted that there is inconsistency in the development of charging stations, with some businesses promising expansion only to scale back later. This uncertainty can deter potential EV buyers who are concerned about the availability of charging facilities.
Additionally, Bhindi mentioned the role of original equipment manufacturers (OEMs) in driving EV adoption. He suggested that instead of relying solely on fines, regulators should encourage OEMs to bring forward initiatives that can help boost demand.
The Impact of the New Vehicle Efficiency Standard (NVES)
The fines-based approach that Bhindi refers to is the introduction of the New Vehicle Efficiency Standard (NVES) last year. This policy sets fleet emissions caps for car brands, with fines issued if these targets are exceeded. From 1 July 2025, until the start of 2026, Mazda Australia has already accumulated around $25.5 million in fines. As emissions targets decrease over time, this financial burden is expected to grow.
Bhindi acknowledged that the NVES has contributed to the acceleration of all-electric options in the market. However, he pointed out that Australians are still not ready to fully adopt the technology. Despite the availability of over 100 battery EV options, they represent only about eight to nine per cent of the market, with minimal growth year over year.
Common Ground on Reducing Carbon Emissions
Bhindi stressed that there is common ground among all parties on reducing carbon emissions. The initial focus of the regulations was to bring more options into the market, which has been achieved in the past 12 months. Mazda is set to join this trend with two new products.
Now, the emphasis should shift to generating demand. Bhindi believes that even with so many options available, the key challenge lies in convincing consumers to make the switch. He argued that the current approach, which relies heavily on fines, is not the only path regulators should take.
The Role of Industry Lobby Groups
Bhindi also serves as the chair of the Federal Chamber of Automotive Industries (FCAI), a lobby group that includes major car brands such as Toyota, Honda, BMW, BYD, and Ford. This group plays a significant role in shaping industry policies and advocating for the interests of its members.
The FCAI’s position reflects a broader industry concern about the effectiveness of the NVES and the need for a more balanced approach to promoting EV adoption. While the standard has driven the introduction of more electric models, it has also led to increased costs for consumers.
Financial Implications for Consumers
Mazda Australia, along with other manufacturers, has admitted that it will need to increase the prices of its vehicles to offset the fines imposed by the NVES. This could make electric vehicles less attractive to price-sensitive consumers, potentially slowing down the adoption rate.
Despite these challenges, Bhindi remains optimistic about the future of EVs in Australia. He believes that with the right incentives and support, the market can continue to grow and become more accessible to a wider range of consumers.
Looking Ahead
As the automotive industry continues to evolve, the role of government policies and industry initiatives will be crucial in shaping the future of electric vehicles in Australia. While the NVES has played a part in increasing the number of EV options, it is clear that a more comprehensive strategy is needed to drive demand and ensure long-term success.
Bhindi’s comments highlight the need for a collaborative effort between regulators, manufacturers, and consumers to overcome the remaining barriers to EV adoption. With the right approach, Australia can move towards a more sustainable and environmentally friendly transportation system.
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