Tesla leads Australia’s EV surge as cheaper models expand market

Who is the typical Tesla driver on Australian roads today?

Well, according to Roy Morgan they’re an ageing, white-collar worker from Sydney with an annual income of at least $100,000.

They’re married, have kids and own a home – you get the picture.

These Australians have been at the front line of an astonishing trend in the car market in recent years, with Roy Morgan data published on Wednesday revealing more than half a million people plan to buy an EV in the next four years – which is about 12.5 per cent of purchases.

It’s a stunning increase – about 1230 per cent – on the same purchasing intentions back in 2019.

Figures like that are encouraging, and Roy Morgan chief executive Michele Levine said Tesla is a key reason, noting the American manufacturer is now a top six brand.

“Tesla is synonymous with electric vehicles and has experienced a similar surge in interest as a wider variety of models have become available,” Ms Levine said.

“Now 369,000 Australians say they intend to purchase a Tesla in the next four years compared to only 37,000 in the year to March 2018 – an increase of almost 900 per cent.

“This is a sharp rise for Tesla, which was only the 16th largest-selling brand of car as recently as 2022.”

Griffith University lecturer Anna Mortimore said this picture of ‘Tesla man’ is supported by other research, which has previously found Tesla buyers are more likely to be high-income earners who live in larger homes.

“Tesla buyers are prepared to pay the price premium for the vehicle’s technology,” Dr Mortimore said.

“They comprise the group ‘innovators and early adopters’ who are prepared to pay the price premium for an EV compared to an equivalent internal combustion-fuelled vehicle, representing around 15 per cent of new car buyers.”

Mass market needed

But with experts warning that Australia must stop selling combustion engine vehicles by 2035, the quintessential Tesla man is going to need to change massively over the coming years.

Dr Mortimore said the “mass market” of consumers will be more challenging to move from traditional vehicles to EVs because “price matters”.

“Hopefully, by then, we will see cheaper EVs coming onto the market once Australia introduces fuel efficiency standards and stops importing cheap combustion-fuelled vehicles,” she said.

A Tesla model Y still costs about $68,900 in Australia – that’s $20,000 more than the average Australian family spends on a new car, and most only ever shop for second-hand cars.

And so, despite an estimated 548,000 people intending to buy an EV over the next four years, there’s going to need to be a massive expansion in the range of vehicles to spark change.

Advocates are hopeful that a recent federal government move to introduce fuel efficiency standards nationwide will convince manufacturers to send their cheaper EV models Down Under.

Price drop signs

There are signs that’s already happening, with China-based manufacturer MG this week unveiling the first sub-$40,000 EV in Australia – an electric hatchback with a 350-kilometre range.

Three other models will also be sold from August, with the total offering priced between $38,990 and $47,990 before on-road costs.

Elsewhere, manufacturer BYD is on Thursday launching an affordable EV called the Dolphin, which is expected to undercut MG in a move advocates hope could spark a price war.

Ms Levine said data showed that while Tesla is clearly the dominant force in Australia’s EV market today, there is a widening gap opening up with those looking to other manufacturers.

There are about 180,000 Australians who want to buy an EV, but aren’t looking for a Tesla.

“There is an increasing gap opening up between those who want to buy an electric vehicle and those who intend to purchase a Tesla,” Ms Levine said.

“This gap, which didn’t exist three years ago, shows that as other manufacturers – such as BMW, Mercedes, Volvo, BYD and MG – launch competing electric vehicle brands, there is an increasing market for these vehicles to tap into.”

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