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Wednesday, November 30, 2022

Tesla Australia: Elon Musk welcome to manufacture as EV strategy released

Infrastructure Minister Catherine King has said a Tesla manufacturing plant would “absolutely” be welcome in Australia.

Her comments come after the company’s most senior Australian executive hinted the electric vehicle giant could expand its manufacturing capabilities here.

Tesla board chair Robyn Denholm told the National Press Club in Canberra earlier this month the company wanted to have manufacturing capability on every continent.

She said Tesla needed to “be in all of the major markets” in order to compete in a world moving towards the widespread use of electric vehicles and lithium-ion batteries.

Ms Denholm said Australia had the skills and natural resources to get more people into advanced manufacturing, including making cars.

“Tesla is a prime example of that; we’re producing vehicles in California, which is one of the most expensive places on the planet, and shipping them all around the world,” she said.

Ms King said on Wednesday she would welcome a Tesla plant in Australia.

She said the “incredibly disappointing” winding down of the Australian car manufacturing industry – which folded in 2017 with the last General Motors Holden – had broad implications for research and development.

The Albanese government has been enthusiastic about ramping up local manufacturing capability, indicating this could include making cars once again.

But Energy Minister Chris Bowen was noncommittal when asked on Wednesday if it was realistic to expect cars to be produced in Australia.

“We’re very excited as (Ms King) said, right up and down the supply chain,” he said.

“The economics of electric vehicle manufacturing are very different to traditional internal combustion engines, whether it’s full vehicles or those components of vehicles along the way.

“And as I said at the outset, the more we have an electric vehicle market in Australia, the more that will support electric vehicle component – and indeed, potentially more in due course – manufacturing.”

Mr Bowen and Ms King made the comments as they unveiled a consultation paper outlining the framework for a new national electric vehicle strategy.

The paper notes Australia’s current policy settings have failed to secure affordable supply, with EVs making up fewer than 2 per cent of new light vehicle sales in 2021 compared with 9 per cent globally.

The federal government is also seeking views on implementing vehicle fuel efficiency standards to help drive down greenhouse gas emissions.

“Australia is in company with Russia as one of the only major economies without vehicle fuel efficiency standards in place or under development,” the consultation paper notes.

The government is aiming for a rapid increase in demand for EVs as it increases affordable and accessible supply and sets up the necessary charging infrastructure.

Electric Vehicle Council chief executive officer Behyad Jafari said the “most urgent” next step would be the introduction of a strong fuel efficiency standard.

He said higher standards would be necessary in order for Australia to seize the opportunity to build products “right across the EV supply chain” and remain competitive.

“We have been at the back of the global queue for new vehicles, but with the right policy settings, we can get this right and accelerate progress,” he said.

The Motor Trades Association of Queensland said the discussion paper was “an important step forward” on Australia’s “journey to electrification” by co-ordinating the different policies of each of the states and territories.

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