Experts warn rising ute prices will hurt housing supply

Jarrod
By Jarrod
4 Min Read

New fuel efficiency standards are set to hurt tradies’ wallets, potentially throwing the ­nation’s housing supply into uncertain waters.

The Housing Industry Association (HIA) said they are concerned about the impact the Government’s new emissions standards for popular utes, 4WD and SUVs will have on the cost of doing business for tradies, ultimately risking the future of the country’s 1.2 million housing build target over the next five years.

“Industry experts claim to have modelling that shows the new laws will add significant upfront costs and are likely to result in car manufacturers needing to scale back the key types of vehicles our industry relies on to run and operate their businesses,” said HIA Chief Executive Simon Croft.

“At the moment, there is no viable alternative to replace these vehicles.

“Over the past three years, the building industry has faced significant construction price increases, arising from material and labour shortages, as well as a range of changes to building, WHS, taxation and business compliance costs.

“Any further added costs, complexities or regulatory impediments being layered over the top of our industry at this time will only make their jobs harder and have downstream impacts on housing supply and affordability.”

No cars will be banned under the proposed plan, but penalties will range between models depending on their average emissions and whether or not they exceed the Government’s cap.

According to estimates compiled by the Federal Chamber of Automotive Industries (FCAI) last week, Australia’s top-selling Ford Ranger would incur a penalty of $6150 under the proposed 2025 policy.

The analysis also predicted that the beloved Toyota LandCruiser — the seventh most popular car last year — would see the highest penalty out of the top 20 of $13,250.

The carbon penalty incurred by Australia’s other top five cars, the Toyota HiLux, Isuzu Ute D-Max, Toyota RAV4 and MG ZS, would be $2690, $2030, $2720 and $3880, respectively.

Mr Croft said the building industry wasn’t directly consulted on the new emissions policy despite the potential impacts rising vehicle costs would have on the nation’s already shaky housing pipeline. 

“If the Government wants to build 1.2 million houses in five years, it needs to consider the needs of the workers who are responsible for reaching that target,” he added.

Despite the FCAI’s damning price modelling, the federal Government continues to reassure tradies that the new policy won’t increase the costs of utes, 4WD’s or light-commercial vehicles. 

But without any evidence to back up their claim and several sources accusing the policy of inflating already sky-high construction costs, Mr Croft said the Government needed to release their own price predictions to the public.  

“HIA understands the intent of the proposed emission standards in reducing fuel costs and lowering emissions, however, the uncertainty of new laws and lack of information being released is not helpful,” he said.

“Therefore, we would encourage the Government to release their modelling to provide clarity and certainty on the new proposed laws to allow industry to adequately gauge the impact of the laws.

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Jarrod
By Jarrod
Jarrod Brown combines his background in journalism, copywriting and digital marketing with a lifelong passion for storytelling. He has a strong passion for new and emerging consumer technology within the building sector. He lives on the Sunshine Coast - usually found glued to the deck of a surfboard.