Ballarat car dealers fear new changes on the way

The federal government's proposed new vehicle efficiency standards mean manufacturers will be charged per unit of emissions if they go over emission thresholds.

The targets are based on yearly averages - all cars can be produced for Australia but companies will need to offer more fuel efficient cars to offset the cars that will not meet the threshold.

Kings Cars principal dealer Peter King said the rapid pace of change was concerning and thought manufacturers would pull out of the market.

He said extra charges would almost certainly be passed onto the customer, making popular cars more expensive.

The government said it wants to ensure there are more fuel efficient car options to choose from.

It said this would mean car drivers would spend less money at petrol stations because they need less fuel if buy a new vehicle.

The federal government has been seeking consultation on the proposal and are hoping to pass the bill by the middle of 2024.

This way the regulations can start from January 1 2025 and rolled out over three years.

Mr King said these timelines are very tight and manufacturers would not have other options - instead consumers would need to swallow the higher car prices.

"It takes a long time for a manufacturer to actually design a vehicle for our market," he said.

"To have these laws introduced to start from the first of January, is insanity."

Mr King does not think car manufacturers will see the Australian market as viable with the proposed changes.

"This is a very competitive industry and the Australian automotive market is only a very small right-hand-drive market in the overall scheme of things," he said.

"We have very strict Australian design regulations and also ANCAP safety rating, to manufacture a vehicle for such a small market, we'll see a number of manufacturers consider it not worthy to stay."

He said he would like to see a longer roll out time for the standards which would mean the impact on the industry could be assessed.

This would also mean there would be more time for new models to meet the legislation.

Victorian Liberal Senator Sarah Henderson told The Courier she thinks this program would "devastate regional communities".

"Our view is we want to see this entire scheme shelved," she said.

"The Coalition supports our emissions [reductions], but we want to do so in a way that is sensible and fair and equitable and this proposal is anything but."

Ms Henderson said car prices could go up by thousands of dollars but Ballarat MP Catherine King said other markets had seen prices stay materially the same.

"New vehicle efficiency standards operate in 85% of the global car market and the Impact Analysis found "evidence to date consistently finds no purchase price impact, or a negligible purchase price impact, for consumers"," Ms King said in a statement.

"And it's obvious that in other countries with a New Vehicle Efficiency Standard, 4WDs and utes as well as petrol and diesel cars are still widely available."