Should Australia make electric vehicles?

In this two-minute video, Cosmos journalist Ellen Phiddian explains the differences between electric vehicles and conventional cars.

While there are many things governments could do to boost uptake further, electric vehicle imports are gently on the rise in Australia. But what if we made them here?

According to a February report from the Australia Institute’s Carmichael Centre, Australia could benefit hugely from setting up an onshore electric vehicle manufacturing industry.

The report states that Australia’s renewable energy potential, mineral resources and highly skilled workforce make it an optimal place to manufacture electric vehicles.

“Thanks to the resilience of our remaining automotive manufacturing supply chain, a surprising amount of auto manufacturing work – including components, specialty vehicles and engineering – still exists here,” says lead author Dr Mark Dean, a research fellow at the Carmichael Centre.

The report outlines a range of initiatives and policies that governments would need to implement to kickstart the industry, including tax incentives to encourage onshore processing of raw mined materials – particularly lithium for batteries – a long-term vocational education strategy, incentivising global manufacturers to set up here, rapidly electrifying government fleets with local cars, and establishing an EV Manufacturing Industry Commission.

“We used to have the industry,” says Gail Broadbent, a researcher in electric vehicle uptake at the University of New South Wales, who was not involved in writing the report.

“It’s only four years ago that it closed, so there’s no reason why the educated, skilled workforce isn’t there.”

In addition to the existing skilled workforce, the report points out that much of the engineering infrastructure needed to make vehicles is still around and could be repurposed.

“That report rightly points out we’ve got the minerals to make the batteries, we’ve got all the materials we need to make cars – so there’s no reason not to value-add,” says Broadbent.

There are places in Australia where the existing manufacturing industry has reinvented itself, connecting with advanced technologies.

The report highlights the Tonsley Innovation District, at the site of the old Mitsubishi factory in the southern suburbs of Adelaide, as an example of government support provoking this sort of development.

“The Tonsley Innovation precinct would be a terrific location for EV manufacturing,” says Giselle Rampersad, Professor of Innovation at Flinders University’s Tonsley campus, who also wasn’t involved in writing the report.

“It includes an innovation ecosystem of large companies, small and medium enterprises [SMEs] and is underpinned by the education sector of [Flinders] providing research and a skilled workforce, as well as the VET sector.”

Rampersad says that while defence has been key to many of these developments, “SMEs operate across several manufacturing sectors and the intent is that spillover benefits can be felt in other sectors, such as EV manufacturing.”

According to Rampersad, educational areas that need attention to build up an EV manufacturing workforce include “engineering (mechanical, robotic, electrical and electronic) and computing (IT and cybersecurity), as smart systems are required in EVs to track usage and also in new advancements related to autonomous features”.

While it’s clear that the industry wouldn’t be starting from scratch, onshore EV manufacture would still need a big investment from government to get up and running – and it would need even more work to guarantee locals would buy the EVs.

Broadbent says that one of the best ways to encourage local uptake is for governments to guarantee they will preferentially purchase Australian-made electric vehicles for their fleets – another initiative suggested by the report. As well as providing confidence for manufacturers, such a policy would have a social effect.

Man works on a car skeleton on a factory floor while a line of cars are levitated overhead
Volkswagen ID.3s on a production line in Dresden. Credit: picture alliance / Getty Images

“It sends a message to the country that the government thinks they’re good enough to buy,” says Broadbent.

It’s also a way to normalise the vehicles.

“All the workers who get to use them in their workplace, get to use them without having to go to the trouble of buying one,” says Broadbent. “They get to see how they work, and they can appreciate the benefits, and it starts a lot of conversations.”

This is why several state governments are currently planning to transition their fleets to EVs, even absent of local manufacturing.

Price and infrastructure are much more complicated issues to tackle on uptake. Widespread charging stations, better incentives to buy and sell EVs, and better regulations on pollution all need to be introduced to make EV usage more widespread.

“People want the infrastructure, and without that infrastructure, it ain’t gonna happen,” says Broadbent.

Rampersad says that “electrification is a journey,”  noting that EVs are part of the transition to more advanced vehicle systems, such as solar cars. “EV manufacturing [is] a vital stepping stone in strengthening manufacturing capability to shape a bright future.”

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