Comments from energy minister Josh Frydenberg expressing his support for electric cars have sparked conflict within the Liberal party, but those in the startup space are hoping the sentiment will lead to further growth in a burgeoning area of Australia’s tech industry.
As reported by The Australian, Frydenberg said over the weekend that the federal government will continue to support the electric car sector via options such as subsidies, labelling the space “very exciting”.
“We are living in the decade of disruption, there is global momentum around electric vehicles and I think they will be to the transport sector what the iPhone has been to the communication sector,” Frydenberg told the ABC.
However, his statement is at odds with many of his Liberal colleagues who believe electric cars could have a larger carbon footprint than traditional petrol-driven vehicles thanks to the vast majority of Australia’s energy being produced by coal-fuelled power plants. There are also concerns potential subsidies for users of electric cars could create a divide between those who can and cannot not afford them.
“The risk here is you’ll have the rich person in Balmain buying a Tesla, subsidised by a bloke in Penrith who’s driving a Corolla. And the Tesla will have more carbon emissions than the Corolla,” Liberal MP Craig Kelly told The Australian.
Speaking to StartupSmart, angel investor and entrepreneur in residence at BlueChilli Alan Jones disputed Kelly’s opposition to electric vehicles, saying his arguments around carbon emissions can be proven wrong in “so many different ways”.
“First of all, the zero emissions from a coal-fired electric car has to equate to less than the total emissions required to import, refine, distribute, and sell petrol. If the total carbon emissions of the supply chain are taken into account, I think the Tesla still comes out ahead,” Jones says.
“Even if that’s not the case, the obvious correlation between people opting out of coal-fired power means it makes good sense for the government to support electric vehicles.”
Jones says there’s also a steadily growing part of the market of consumers producing their own power through solar panels who would be attracted to electric cars thanks to the lower emissions
Infrastructure key for growth
Frydenberg predicted there could be 1 million electric cars on the roads in Australia by 2030, and flagged a number of “logistical issues” as the priority for federal and state governments to address to ensure adoption from consumers.
“What we will need to see is some of the infrastructure issues solved because when people come to make a decision about the vehicle they purchase they want to make sure that if they do purchase an electric vehicle that they can plug it in when they go on a long road trip and the infrastructure is consistent throughout the country,” he told ABC.
But Jones isn’t worried about potential infrastructure issues, saying only a tiny proportion of Australians drive more than 30-40 kilometres a day.
“If you want to drive your Tesla up the Gold Coast it’s a good idea to have a supercharger on the way, but otherwise it’s not going to be a problem,” he said.
While she welcomes the discussion about the future of the electric car industry, partner at Blackbird Ventures Samantha Wong implores the government to think beyond “exclusively debating” if it should be made easier for consumers to get their hands on electric car tech via subsidies.
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Instead, she thinks the focus should also be on the country’s role in designing, manufacturing, and operating electric vehicles.
“We have talent in Australia that is capable of building out the products and services to support this industry, but they often go offshore for jobs or first customers because there just isn’t enough of a market here,” Wong tells StartupSmart.
“If this is truly an iPhone-like revolution unfolding, I’d love to see us reap some of the economic as well as environmental benefit.”
Despite the electric car space being an automotive industry, Jones says it’s software for the cars that will be the biggest opportunity for startups; the fewer mechanical components in electric cars leaves more doors open for software developers.
“The management of electric cars themselves are moving towards autonomy and driving themselves. There are already some great Australian startups looking at this, such as Zoox,” he says.
Flying, not electric, says Baxter
But River City Labs founder and prominent investor Steve Baxter believes the future of transport won’t be earthbound at all, telling StartupSmart last week his “big hairy audacious goal” is to shift the focus from autonomous and electric cars to flying ones.
“We’re seeing some exceptionally advanced prototypes in the space that are going to be quite capable. Flying cars will be able to reduce congestion, avoid traffic, and mean we can stop spending money on building roads,” he says.
“When you can commute 100 kilometres in half an hour, people can start to live 100 kilometres away from their work, which opens up a lot of possibilities.”
“There’s a big infrastructure change coming and it’s not driverless cars — people are never going to stop driving their own cars. Policymakers aren’t thinking through this, we could have a brand new lane 500 feet up.”