Clunker rebate 'too small to work'

Suzuki boss, Tony Devers, wants it ramped up to make it more attractive to motorists.

"If you look at some of the countries in Europe, they had incentives of up to 5000 Euros ($7200)," he says. "The amount should really be higher. I don't think $2000 is enough to get people into these cars. It's very limiting."

Devers, who has been campaigning for a similar scheme for the past 12 months, says the $2000 would disadvantage the very people it is designed to help. Many people driving around in pre-1995 vehicles may not be in a position to afford a new car, he says.

Under the Gillard scheme owners of vehicles older than 25 years will be offered a $2000 rebate to switch to new, more fuel efficient vehicles. But Devers says there is little detail from the Labor Party on what constitutes a 'low-emission, fuel-efficient vehicle'.

"We need to see a list of eligible vehicles," he says. "At present it is lacking in detail."

Gillard's rebate scheme has received lukewarm support from the car industry. Although the peak body representing the Australian automotive industry, the Federal Chamber of Automotive Industries, has thrown its weight behind it, chief executive, Andrew McKellar, admits it is light on detail. He says it needs to be evaluated 'on a stand-alone basis'.

"Obviously we would need to look at the detail," McKellar says.

McKellar accepts that critics will call for more effective incentives and tax breaks, rather than a $2000 rebate, to get people into greener cars.

"If the object is to look at what the range of policy initiatives in relation to emissions can be, then there are obviously a wide range of options and opportunities," he says. He rejects the idea that it is purely an election stunt. "We are in an election campaign, so it would be expected that there will be policies and commitments and things that will come out of left field," he says. "And this is one of those."

Suzuki's Devers has been vocal in his push for a scrappage scheme. Last year he was instrumental in pushing a 'first-buyers' car scheme similar to the first homeowners' grant. It is one option he would like to see on the Labor agenda. "I still think that is viable," he says.

Devers believes the Government also needs to clearly outline its green car policy, rather than reward local manufacturers for building green cars. "Where is their green car policy?" he says. "If their fair dinkum give incentives across the board."

Compared to other countries and even some emerging Asian Tigers, Australia has one of the oldest carparks in the Western world. According to ABS statistics, the average age of cars in Australia is 9.9 years, with 20 per cent of registered vehicles built before 1994.

However, this is still higher than other countries such as the United States (9.4 years), Europe (8 years) and Japan (6.2 years). Currently there are two million pre-1995 vehicles on Australian roads.  McKellar says many do not meet today's environmental and safety standards.

"A key part of any strategy to reduce carbon emissions from road transport must address the impact older cars have on the environment," he says.

The FCAI also supports a bid to develop a regulated carbon dioxide emission standard for new light vehicles.

"The industry is confident we will reach agreement with any incoming government on the detailed structure of a new standard, including ways to recognise the uptake of emerging low emission technologies and alternative fuels," McKellar says.