Technical – Society of Automotive Engineers Australasia Zero Emissions Vehicle Project

Noi Kotev noi_kotev@hotmail.com Evan Favos evan.favos@outlookcom

Society of Automotive Engineers Australasia Zero Emissions Vehicle Project

VFACTS SUMMARY ANALYSIS

The Federal Chamber of Automotive Industries (will be referred to as FCAI from here on) releases a highly regarded document containing a wide range of data on new vehicle sales in Australia every year known as VFACS. As per the scope of this ZEV market study, analysis on new ZEV vehicle purchases within the government sector of Australia has been done using VFACTS of the years 2015 to 2021. Relevant information pertaining to the study has then been collated and tabulated for an all-inclusive perspective of current market behaviour over the last six years. The following is an exploration of total vehicle sales throughout Australia, followed by an analysis of these sales based on individual vehicle body-weight categories, then a deep dive into the distribution of those vehicle body-weight categories procured by government bodies; and lastly, the proportion of various ZEVs based on fuel types purchased. Firstly, by collecting all the data from ‘New Vehicle Sales’ in VFACTS from the years of 2015 to 2021 a separate data table was created (shown in Appendix 1). This was turned into a line graph (Figure 1) for a visual representation of Australian state’s vehicle purchasing habits over these years. It is noticed that New South Wales, Victoria and Queensland hold the majority the country’s new vehicle purchases and so these will be the ones to focus on. It can be seen that New South Wales purchases the highest amount of vehicles overall than any other state, with their yearly maximum over the this time range at 397,273 vehicles purchased in 2017. The state with the next highest number of new vehicles purchased in a single year is Victoria with 399,643 vehicles, also in the year of 2017. The next state to purchase the greatest number of vehicles over this range is Queensland, with a maximum yearly vehicle purchase of 235,674 in the year 2015. Furthermore, this chart also shows the general trend of the new vehicle market in Australia. With all three of the top purchasing states showing a negative trendline signifying fewer new vehicle purchases over those years; with New South Wales and Victoria showing a 20% decrease and Queensland showing a 9.5% decrease. It is important to note that 2020 and 2021 sales are significantly decreased as these years signify the COVID-19 pandemic. However, this general negative trendline is noticed even by observing solely the 2015 to 2019 yearly sales; with New South Wales showing a 11%, Victoria showing a 3.5%, and Queensland a 9.5% drop in sales (when disregarding the pandemic years). The next section of VFACTS that has been analysed in depth is how market sales were distributed across various vehicles bodyweight sizes and if that affected their yearly sales. The FCAI has broken up the vehicle market by Passenger vehicles, SUVs, Light Commercial vehicles (comprising mostly of Utes and vans) and Heavy Commercial vehicles. For the sake of this analysis, Heavy Commercial vehicles will be disregarded as per the scope. On first inspection it is clear that passenger vehicles sales have been steadily decreasing over the years of 2015 to 2021 while both SUVs and Light Commercial vehicles have been increasing. Passenger sized vehicles dropped from 515,683 vehicles purchased per year in 2015 to 207,060 vehicles per year in 2021, showing a decrease of 60% in annual sales; meanwhile SUVs increased from 408,471 to 491,351 annual new vehicles sales showing a 20% increase and Light Commercial Vehicles increasing from 199,070 to 233,338 in annual new vehicles sales showing a 17% increase. Additionally, all three vehicle weight categories show a significant dip in sales in 2020, which again could be due to the pandemic. However, unlike passenger vehicles which continues its negative trendline during those pandemic years, SUVs and Light commercial vehicles overcome this and return to their positive trendline sales in the year of 2021 even during the pandemic. VFACTS divides annual new vehicle sales by body-weight class as well as by which

Figure 1

Figure 2 - Vehicle Sales Broken Up By Weight Class

purchasing sectors have bought them; specifically by the Private sector, Business sector, Government sector and Rental sector. The following analyses was conducted solely on the government sector as per the scope. As previously mentioned, passenger vehicle sales have been steadily decreasing over the years of 2015 and 2021, this negative trend continues in Figure 3 showing procurement by the government sector. It shows there has been a decrease of new vehicles procured by government entities from 17,220 sales in the year 2015 to 5,465 sales in the year 2021 signifying a 68% drop. On the contrary, SUV sales show a slight positive trendline over the same years. However, this data does not take into account the context of 2020 and 2021 which forced a much of the government sector to working from home over those years causing this severe decrease in sales. To allow for this concession in sales, another version of this same analysis was conducted to view the trendline behaviour prior to the pandemic. Here the increasing trendline for the government sector’s procurement of new SUV and Light Commercial vehicles prior to the pandemic is easily noticed. With the steady increase in sales of SUV’s up 9% and of Light Commercial vehicles up 3%. Interestingly, it is seems that on years where SUVs reach a maximum amount of sales within the government sector, Light Commercial vehicles reach a minimum, and vice versa. Contextually speaking, each nodal point corresponds to an anti-node on the other vehicle. For instance, over 2017, 2018 and 2019 the SUV and Light Commercial vehicle sales alternate from node to antinode. Although, as a whole both sectors continue to show a steady increase in sales. The next point of analysis for Figure 4 is that Light commercial vehicles over all have a significantly higher amount of sales than Passenger sized or SUVs, averaging 2000 more new vehicle sales to the government sector in Australia than SUVs every year between 2015 and 2019.

The following, and last set of data analysed from VFACTS data is the total number of new vehicle sales in Australia as categorised by fuel type. As per the scope, hybrid vehicles where not analysed and-so the two fuel sources inspected where Electric and Hydrogen based vehicles. As is clear, Electric vehicle sales have increased significantly over the years of 2015 to the year 2021. Starting with a new vehicle sales amount of 1,108 for the year of 2015 and increasing to 4,597 new vehicle sales in the year 2021; accomplishing an astonishing 315% sales increase. Hydrogen vehicles being still so new to the market, began their first sale in the year 2021 at 37 new vehicles being sold, which could be said to be a 370% increase to the previous year. Both fuel types show a significant competitive advantage with such profound sales increases over the past six years.

LOCAL STATE SUMMARY ANALYSIS

Local state analysis was conducted by research interns in their respective states. Conducted during the COVID19 pandemic and state-wide lockdowns, all communication was conducted online. The aim was to target local government institutions such as police stations and seek to find information relating to the procurement habits of said institutions. State government research was conducted in three key states: NSW, Victoria and the ACT. For the ACT, a representative from the Zero Emissions Government shared insight into the sector in the ACT.

In the ACT, 11% of the registered vehicles are Utes. Of these, there are 400 vehicles in the ACT Government fleet, which range from specialised vehicles which are used in residential and remote areas. Mainly focused on passenger vehicles, the government is aiming to expand their usage of ZEV for government fleet work by 2024. From NSW, a contact from Investments in the NSW government was made. The information given was able to shed insights into the procurement process and financial situation of the current NSW government and the want to adopt ZEVs in government fleets. There are 26 000 vehicles in the NSW government fleet. Of these, 12,000 are typical passenger vehicles (for example, Toyota Camry’s) and the remaining 14,000 are typical Ute vehicles. In NSW, the NSW Treasury manages all leases of vehicles for government fleets. However, the decisions as to what style of vehicles are procured are left to the individual government agencies, with treasury providing a buyers list for individuals to choose.

and local government organisations were contacted. Although difficult to find solid figures on each department’s procurement details, certain information was able to be found. The Fire Rescue department in Victoria stated they had 227 vehicles excluding technical operations pods and pumpers, as per their 2020 annual reports. As such, for more procurement information, it is recommended to contact local treasury directly for further information. By going through the Spokesperson for Local Government, Planning, Transport and Industrial Relations – Sam Hibbins (Victorian Greens – Prahran), it was found that as of September 2021 there are 12,107 active vehicles in VicFleet which include 2376 hybrids and four EV. VicFleet uses a consistently updated list of vehicles (known as the ‘Approved Vehicles List’) from which government, departments and agencies are to choose their fleet of vehicles from, see Appendix 2. Ambulance Victoria reported back with 1400 vehicles with more than half of those being Mercedes Sprinters for their ambulances. Their next predominant vehicle type is the SUV which is used as their response vehicle and lastly the remaining are a mix of sedan and light commercial vehicles. They were also able to comment that hybrids are their vehicle of choice, with the exemption of ambulances, and they are in the process of assessing EVs for the most suitable role within their fleet.

DISCUSSION

Through the data collected via VFACTS report and local state analysis, trends can be used to predict the future of the ZEV market and the feasibility of producing electric utilitarian vehicles here in Australia.

The VFACTS data collected each year from 2015 to 2021 provides an excellent summary into the details of Australia over the 7-year period. From VFACTS, the largest new car market belongs to New South Wales, Victoria, and Queensland. Looking at the trends, we see new vehicle sales dipping or staying the same across the three major states since 2017. Note this occurs before the effect of the COVID19 pandemic. However, since 2020, we see a strong increase in new vehicle purchases, even through the difficulties of the pandemic. Throughout this period, there has been a decrease in passenger vehicle sales, dropping 60% in annual sales. At the same time, the market has grown for SUVs by 20% and for Light Commercial Vehicles by 17%. Although these increasing figures did show a slight dip in 2020, this can be explained due to the financial burdens created on the economy by the COVID19 pandemic, and as such with 2021 being a better year, we once again see sales increase in these categories. Most importantly however is the purchasing of vehicles in the government sector. From 2015, there has been a 68% decrease in passenger vehicles in the government sector. SUV sales over this period have stagnated, and light commercial vehicles have reduced in the 7-year period. Although the sales have reduced, it is important to note that light commercial sales are the only vehicles sales to government industry that has flattened over the 2020-2021 period, during which the COVID19 pandemic was in full effect. Reading into data before and during the COVID19 pandemic is sometimes difficult, as such the government market share was analysed prior to the pandemic, where buying patterns are more predictable. Over the period from 2015 to 2019, passenger vehicle purchasing by government services has decreased, whilst SUV and Light Commercial purchases have increased over this period. It is also important to note, Light commercial vehicles average over 2000 more sales to the government sector in Australian than SUVs. Through discussions with local government areas, there is an enthusiasm to switch to zero emission vehicles as replacements for current internal combustion Ute vehicles.

However, there are concerns over the current Australian infrastructure, and supply chain for building ZEVs in the country. However, in Australia, there is a push to build up the electric vehicle second-hand market. As such, local governments are looking to take that first step into the EV world, and there is no better way than to do this with an Australia built electric Ute vehicle.

However, there is some scepticism within the

Figure 4 - Pre-Pandemic Government Procurement of New Vehicles

industry and government. A representative from the NSW government expressed their feelings towards government agencies wanting to go the ZEV route. There were two main motives they felt behind the push to ZEVs; moving to ZEVs is very fashionable in government to brand yourself as a ZEV supporter and can be used to profile. Or the government wants to help the environment. However, the steps made to support ZEVs has made them feel Australia is not serious about ZEVs.

A representative from the ACT expressed keen optimism and an openness to change with a push to ZEVs, with agencies enthusiastic about the environment and wishing for a solution. A big concern of many is the problem of range anxiety. With certain council stations in the ACT, many vehicles are stored in large depos where electrical supply is limited. As such to maintain ZEVs the sites would require upgrades to allow for mass scale EV development. It is important to note that hydrogen is becoming a bigger contender in the eyes of those looking for a cure to range anxiety. It was expressed to us from the ACT representative that ZEV is not just about going electric – they do not wish to go down the route of just one solution and are open to the possibilities other sources of power can provide in the ZEV market.

CONCLUSION

In conclusion, the market for utility vehicles in government sectors is the strongest of all the vehicle categories, beating out the declining passenger vehicle sector and emerging SUV area. With such a demand for utility vehicles in government sectors such as local council, police, fire and ambulance services, the utility vehicle provides the perfect baseline for ZEV technology. The cabin structure and flatbed design allows for modularity in the design of the vehicle, allowing the vehicle to have multiple purposes. However, the scepticism shown by some members of government and within industry should not be ignored. The current infrastructure in Australia would require a large network upgrade to support the transition from combustion to ZEV. Although it is suggested that with an influx of ZEVs in the government network, this would improve public and government perspective and grow the ZEV market within Australia, thus requiring greater infrastructure support.

APPENDIX 1 Tabulated data derived from VFACTS [2015-2021. VFACTS. Federal Chamber of Automotive Industries, p.1,2,5,6]

APPENDIX 2 Department of Treasury and Finance Victoria. 2022. Approved Vehicle List. Available at: <https://www.dtf.vic.gov.au/vicfleet/approved-vehicle-list>