A plan for a sharp and sudden cut to vehicle emissions will drive up prices and see households and businesses keeping older cars on the road for longer.

“This unrealistic target, supported by partial, simplistic analysis, will inevitably lead to the perverse outcome of making emissions targets even harder to achieve,” ACCI chief executive officer Andrew McKellar said.

The target to cut vehicle emissions by 60 per cent in five years is simply unachievable and will lock many potential new-car buyers out of the market due to higher costs.

“This means that households and businesses will keep their older, less fuel-efficient vehicles for longer,” Mr McKellar said.

ACCI, Australia’s largest and most representative business network, has outlined its concerns in a submission to the government’s consultation on a New Vehicle Efficiency Standard (NVES).

“ACCI is not opposed to introducing the NVES, but its design is crucial. The scheme as presented will have the opposite effect to what is intended,” Mr McKellar said.

The government’s favoured option is a heavy-handed regulatory approach that ignores the reality of rational consumer decision-making.

“The unachievable targets will likely result in severe penalties for car manufacturers. Consumers will end up paying more and face reduced choices in terms of model selection.

Regional Australians, tradespeople and emergency services will be unfairly impacted, as there are currently no low-emissions alternatives to 4-wheel drives, utes and other light commercial vehicles in the Australian market.

Recent warnings from car manufacturers and trading partners that a sharp increase in vehicle prices will be the result demonstrate that the scheme as proposed is unrealistic and too ambitious.

The submission can be downloaded here