Higher gas prices appear to be reshaping New Zealand's car market, according to Radio New Zealand.
As 91-octane gas rose from 2.90 New Zealand dollars ($1.62) a liter to NZ$3.35 ($1.87) a liter in the third quarter, electric vehicle registrations surged 206% year over year.
Here's what to know
The quarter brought 55,317 passenger car registrations, per RNZ.
That was up 14% year over year and over 50,000 for the first time since late 2023. Overall, new car registrations increased 19%.
Conventional hybrid registrations increased 7.7%, and plug-in vehicles led the growth. Battery EV registrations jumped 230% year over year, and plug-in hybrid registrations rose 169%.
"I think what we're seeing at the moment is that there's quite a big focus from both households and businesses on trying to get the most fuel efficient and cost-effective option," Brad Olsen, principal economist at Infometrics, said, per RNZ. "Even if they've got to pay a bit more up front for a new EV, it's still got better running costs over time."
More background
Olsen told RNZ that full battery EVs and plug-in hybrids took a much larger share of the market in the quarter, making up 19% of all car registrations, up from 7%.
"The number of petrol and diesel registrations continue to fall, and that's because people are again switching things up, trying to be a little bit more cost-effective and making a much stronger decision on what car they might be purchasing next," he added.
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Olsen noted that interest in EVs dropped sharply after the clean car discount subsidy was removed in 2023, then started recovering.
The upswing has continued and has also been supported by more EVs becoming available at different price points, he told RNZ.
What can be done?
Households and businesses are weighing higher purchase prices against the potential to spend less on fuel and other running costs, according to Olsen.
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"Funnily enough, New Zealand consumers are fairly rational. When prices go high for fuel, people think, 'Maybe I'm better off looking at an EV,' and they have," Olsen told RNZ.
Where can I learn more?
High fuel prices are only one reason more drivers are looking at EVs.
• Across the U.S., fuel prices sparked pump anxiety as drivers reconsidered gas cars.
• For drivers, EVs save money versus gas cars when fueling and maintenance are added.
• Worldwide, EVs now make up 1 in 4 new car sales.
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