What the Clean Car Discount Means for Buyers

The government’s recent Clean Car Discount scheme announcement may have left you wondering what this means for you the next time you buy a car. How the scheme impacts on you depends on the type of car you buy and when you buy it, as the rebate scheme introduced on 1 July this year is set to change from 1 January 2022.

So, whether you’re in the marketing for a new vehicle today or are simply curious about what it may mean in the future, here’s a short wrap up.

First up, here’s what the Clean Car Discount looks like for car buyers today:
● If you buy a new electric vehicle (EV) you will receive an $8,625 rebate.
● If you buy a new plug-in hybrid vehicle (PHEV) you will receive a $5,750 rebate.
● If you buy a new-to-New Zealand used EV you will receive a $3,450 rebate.
● If you buy a new-to-New Zealand used PHEV you will receive a $2,300 rebate.

For vehicles to qualify, whether they’re fully electric or plug-in, the purchase price must be less than $80,000 (including on-road costs and GST), they must have a star safety rating of 3 or more, and must not have been registered before in New Zealand.

How does the rebate work?

A downside to the Clean Car Discount scheme is that the rebate isn’t applied at the time of sale. You still need to pay the listed price for the vehicle at the dealership. Once you’ve purchased the vehicle, you then apply for the rebate through Waka Kotahi | Land Transport Agency showing proof of purchase and vehicle registration. Waka Kotahi will then transfer the rebate to your bank account.

What’s next in the scheme?

The next proposed step in the Clean Car Discount scheme is that cars will incur either a fee or a rebate on a sliding scale based on their CO2 emissions. The higher the CO2 emissions the higher the fee – with a maximum fee of $5,175 for new vehicles and $2,875 for new-to-New Zealand used vehicles.

Likewise, EVs and PHEV rebates will change to be based on a sliding scale, the lower the emissions, the higher the rebate. Cars registered in New Zealand before 1 January 2022 won’t be subject to the fee or qualify for the rebate.

Ultimately, you may be better off buying an EV

One of the main things the Clean Car Discount does is make EVs and PHEVs more accessible and attractive to buyers. Depending on the price range you were looking at to purchase a new vehicle, the rebate (and soon to be introduced penalties) mean an electric vehicle may now fall within your budget, or at least be a more attractive option, than before the scheme was introduced.

And existing cars?

The Clean Car Discount scheme only applies to new-to-New Zealand cars, so vehicles currently driving on our roads won’t be affected. If you’re looking to purchase a car through Trade Me or a used car sales yard, you won’t be able to take advantage of the rebate or have to pay a fee.

But, if you’ve been considering upgrading to a new EV or plug-in-hybrid, now may be the perfect time to do so.