COS 2022: Raising the Attractiveness of Electric Vehicles

MP Louis Chua

Mr Chua Kheng Wee Louis (Sengkang): In 2021, Singapore’s population of electric cars more than double from 1,217 to 2,942 cars. This, however, only represents 0.5% of the 645,000 cars in Singapore today. So, this uptick is encouraging, considering that much of the increase was contributed by the 924 units increase in the number of Tesla’s here in Singapore, which costs about S$200,000 each.

The economics of EVs currently is still such that it is difficult for the average Singaporean to adopt EVs. EVs are much more expensive compared to the equivalent for Internal Combustion Engine (ICE) cars and you see that the Hyundai Ionic Electric, after considering various rebates, retails for $173,000, $45,000 or 35% more compared to the $128,000 for the Ionic Hybrid, and $65,000 or 59% more than the $108,000 for the ICE Hyundai Avante.

I believe more can be done to ensure that we phase out ICE vehicles ahead of 2040, especially in the context of Singapore’s COE system. Norway, for example, saw 84% of new car sales in January being all electric.

Even as EV prices starts to come down with advancements in manufacturing, the disparity in price between EVs, after factoring in Government incentives, are still significant. EV owners will also expect to fork out an additional tax of $700 a year from 2023, introduced to partially cover the loss in fuel excise duties from ICE cars, with the higher charges already starting to be phased in since 2021. This reduces the attractiveness of EVs to consumers at a time where we should be pushing forward for adoption.

I hope the Government will also consider longer-term policies, such as preferential access and toll rates, which have been shown to show a significant impact on boosting EVs sales in Oslo and several Chinese cities. We also need to accelerate the rollout of EV charging points across Singapore to further incentive EV adoption and ensure it is both economical and practical for Singaporeans to adopt EVs.

8 March 2022
Ministry of Sustainability and the Environment

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