“This anticipated growth will be driven by the increasing popularity of China-made EVs, which offer a strong price-value proposition and are gaining awareness among consumers. China-made EV brands, such as BYD and MG, are expected to play a significant role in driving EV market growth in New Zealand. These brands are becoming more popular due to their competitive pricing and value offerings, which are appealing to cost-conscious consumers seeking affordable EV options,” BMI says in a report issued earlier this week.

BYD plans new SUV models for the NZ market, BMI notes, plus an all-electric ute (previewed by Driven in April, when it was billed as arriving on our shores “within a year”). “The latter could prove to significantly boost EV demand, given the high popularity of utes within the New Zealand consumer market,” BMI says.

Toyota and Ford – whose Hilux and Ranger ranges dominate sales – also have electric utes in the pipeline.

BYD has already been making inroads in NZ, albeit with a bigger share of a smaller pie (see table below).

“Moreover, the new National Party-led Government has pledged to deliver some 10,000 EV chargers nationwide by 2030. In our view, this development is crucial to sustain EV demand over the medium and long terms, as it will diminish ‘range anxiety’ concerns, which is a common issue among potential EV buyers.”

Last week, ChargeNet – the dominant player in the local market – said it was still waiting on details of Transport Minister Simeon Brown’s plan.

BMI still sees EVs taking over the market, with relentless rises from next year to reach 50% market penetration by 2033.

Beyond wider charging networks and Chinese competition, BMI says the key driver will be the cost-gap between petrol and electric cars – today around $20,000 for equivalent average-priced vehicle – narrowing, “primarily driven by advancements in battery technology and economies of scale”.

The flipside: higher insurance, repair, power bill costs

In a report earlier this year, research firm Gartner predicted it would actually be cheaper to produce an EV than an ICE (internal combustion engine) car by 2027.

It saw a rapid reduction in EV manufacturing costs as big makers shifted to so-called “gigacasting” or “megacasting” by Toyota and others, which will simplify manufacturing and take out many of the costs as it requires fewer parts and dramatically less welding.

Traditionally, the main body of a car has been made by welding or stamping together a large number of separate parts. Gigacasting or megacasting, on the other hand, uses casting machines to force molten metal into moulds under high pressure to produce large aluminium body parts, such as the entire underside of a vehicle.

The flipside is that EV owners will have to “wrestle with higher repair and associated insurance costs”, Garner says.

An electric vehicle is already costlier to repair than a petrol car, Gartner says.

“By 2027, the average cost of an EV body and battery serious accident repair will increase by 30%,” Gartner says.

“Gigacastings are big casted floor pan parts that reduce the time needed to produce the whole vehicle floor pan by reducing the number of parts. If a crash damages the gigacasting, this will mean replacing it entirely, and that will be costly.

“A crashed vehicle can no longer be repaired by stretching the chassis back to its original form.”

Another potential fly in the ointment is pressure on power prices as increasing EV adoption, the rise of massive data centres and a shift from gas to electric appliances, and other factors, put pressure on NZ’s grid.

Chris Keall is an Auckland-based member of the Herald’s business team. He joined the Herald in 2018 and is the technology editor and a senior business writer.