In forty-five years of commenting on the car industry I have never seen it in such a confused state.

The transition towards zero emissions has not been an easy path and whilst the move to an electrified future is assured it is currently in a state of flux. Electric vehicle (EV) sales have stalled while hybrid electric vehicles (HEVs) in the last six months have outpaced electric vehicles by 60 percent. Battery electric vehicle (EV) sales continue to retreat despite the fact most importers have been slashing their models by a considerable margin. The best-selling electric car in Australia, the Tesla Model Y SUV, is now $9,500 more affordable than at the start of the year while the 2025 Polestar 2 models have just had a $5,000 price cut with more standard equipment. While BYD, MG, GWM and Ford have all dropped the prices of their electric models in recent months.

And with an onslaught of new Chinese brands due here in the next twelve months industry pundits suggest the price competition in the electric vehicle market is going to intensify putting a lot more pressure on the established brands. Forty new electric models are expected in showrooms next year. The car market in Australia is already one of the most competitive in the world and it’s going to get a lot hotter. What is clear is that the large price reductions on electric models are going to put enormous pressure on resale values. As I’ve said for some time, early adopters of electric cars are going to pay heavily in resale values at trade-in time, particularly models getting toward the end or near the end of their battery warranty. Last week two prominent dealers told me they had trouble getting a trade-in valuation on a Tesla model 3 sedan - in many cases if the battery needs replacing it will cost more than the vehicle is worth.

With EV sales the world over slowing many manufacturers are now re-assessing the time frame for their full introduction. South Korean manufacturer Hyundai only last week announcing it will now expand the number of hybrid (HEV) models from seven to 14 as part of a new electric vehicle strategy. Quite clearly Toyota in the last two years has had enormous success with its hybrid (HEV) models, and in August, 55.5 per cent of its sales were hybrids, its RAV4 SUV achieving its highest sales month in the model’s 30-year history and the month’s best-seller. Whilst the U.S., Canada and the European Union have introduced strong tariffs to on Chinese electric cars tp protect their local vehicle industries, in Australia, now with no home-grown product, the established European, Japanese, American and Korean importers are now at the mercy of the Chinese importers who have high aspirations for gaining strong market share. If you’re in the market for an electric car I suggest you wait and see what happens over the next 12 months. Watch this space.