FCAI Submission to: Future Fuels Strategy Discussion Paper

The Federal Chamber of Automotive Industries (FCAI) welcomes the opportunity to provide input into the Future Fuels discussion paper – February 2021.

FCAI commentary will only be specific to certain elements of the Future Fuels Strategy as it pertains to light duty motor vehicles (passenger cars and light commercial vehicles) and motorcycles.

The FCAI is the peak Australian industry organisation representing over 50 global automotive brands who design, manufacture, and sell light duty passenger vehicles, light commercial vehicles, and motorcycles around the world.

The automotive industry in general, and the FCAI membership specifically has and continues to make significant contributions towards climate change goals both internationally and domestically through the introduction of a range of Zero and Low Emission Vehicle (ZLEV) technologies.

The global companies that we represent collectively spend over $100b a year in Research and Development (R&D) to bring new technologies to market; in comparison global defence and aerospace R&D is around $22b. These companies see countries across the world put in place an extensive range of policy measures to increase the use of EVs and other low emission vehicles, from funding infrastructure, mandating ZLEV fleet targets and providing purchasing incentives for consumers. These countries have taken this policy action because they recognise that significant barriers exist for these new vehicle technologies to be adopted by consumers in numbers necessary for the transport sector to play its role in meeting net zero CO2 targets. Without the right policy settings, based on international experience, the market share of ZLEVs does not shift in any meaningful way.

In a demonstration of the automotive industries absolute resolve to address climate change, in 2020, all FCAI members agreed to a voluntary CO2 code of conduct with an overall target to reduce light transport emissions through to 2030 in line with the Paris Climate agreement. Progress towards this target will be tracked and reported annually. To meet these stringent targets emissions will have to on average reduce by four percent for passenger vehicles and light SUVs and 3 percent for large SUVs and light commercial vehicles.

FCAI strongly supports government investment in the infrastructure required for these advanced powertrain vehicles. Battery Electric Vehicles (BEV) require electrical recharging infrastructure and the emerging Fuel Cell Electric Vehicles (FCEV) require hydrogen refuelling infrastructure. FCEV technology is expected to be critical particularly for larger vehicles where available payload is of paramount importance combined with extended range capabilities which is vital in the Australian context.

Finally, achieving meaningful reductions in emissions will require a range of solutions, encompassing ZLEV vehicles including Hybrid and low emission Internal Combustion Engine (ICE) vehicles that require fuel standards commensurate with those published in the World Wide Fuels Charter. Currently Australia has the worst fuel quality in the OECD; preventing Australians from accessing some of these advanced low emission ICE powertrains.