The New Zealand government is weighing the complete abolition of its Clean Car Standard, just months after significantly reducing the penalties imposed on vehicle importers for bringing high-emission vehicles into the country. The potential move, revealed this week, has sparked concern from electric vehicle advocates and debate within the automotive industry.
Transport Minister Chris Bishop confirmed that scrapping the standard is “obviously” an option being considered as part of a “first principles review.” The review, initiated following a nearly 80 percent cut to Clean Car Standard penalties last November, aims to assess the scheme’s effectiveness and impact on importers and consumers. Bishop had previously indicated a full review would follow the penalty reduction, but suggested complete removal was unlikely.
The Clean Car Standard, introduced by the previous government in December 2022, charges importers for vehicles exceeding a set emissions target, whereas offering credits for those with lower emissions. The system is designed to encourage a greater supply of low and zero-emission vehicles in New Zealand. According to the Inland Revenue Department, importers must manage vehicle imports and meet the standard through a CO2 account operated by Waka Kotahi.
The Motor Industry Association (MIA) has expressed support for retaining the standard, but argues it requires “recalibration” to better suit New Zealand’s market conditions. “The framework needed to be ‘credible, stable, and workable in New Zealand’s small, import dependent market’,” said MIA chief executive Aimee Wiley in a statement. She emphasized the need for settings that work for both importers and consumers, ensuring long-term durability and alignment with market realities.
However, EV advocacy groups have voiced strong opposition to the potential abolition. Drive Electric chairwoman Kirsten Corson warned that removing the standard would abandon New Zealand reliant on “the high-emitting leftovers” that manufacturers can no longer sell in Australia, which recently implemented its own fuel efficiency standard. Corson pointed to early data from Australia showing a drop in overall emissions and the ability of two-thirds of carmakers to meet 2025 targets.
Corson attributed the changes in New Zealand to “spectacular lobbying by some high-emissions vehicle importers.” She likewise challenged the government’s justification for slashing penalties, arguing that the claim of increased costs for consumers was a “false economy.” She noted that while higher-emission vehicles may have a lower purchase price, they incur greater long-term costs through fuel consumption and maintenance.
Drive Electric’s submission to the review warned that abolishing the standard would position New Zealand as an outlier among OECD countries, alongside Russia, as the only nations without vehicle emissions standards. The group also advocated for reinstating a version of the Clean Car Discount, potentially targeted at businesses to encourage fleet electrification.
The targeted consultation for the review, which concluded recently, involved the motor vehicle industry, international bodies, government agencies, advocacy groups, and subject matter experts, but was not open to public input. The Transport Ministry indicated the review is being conducted in two stages, with the first focused on determining whether to retain or abolish the standard entirely. Bishop stated he expects a select committee process and public submissions if legislative changes are required.
