Australia Funds Cheap Loans for Electric Cars as Sales Slump

(Bloomberg) -- Australia’s government is funding cheap loans to help low-income workers buy electric vehicles in a bid to kickstart slumping sales of battery-powered cars.

Backed by A$150 million ($93 million) from the federal Clean Energy Finance Corp., Commonwealth Bank of Australia is now offering EV loans with interest rates up to 5 percentage points lower than normal, Minister for Climate Change and Energy Chris Bowen said Thursday. 

The low-interest debt is available to individuals earning less than A$100,000 a year, as well as essential workers like police officers, teachers and nurses, Bowen said. The loans can be used to buy new or used EVs worth as much as A$55,000.

EV sales in Australia slumped 25% in the third quarter from the previous three months and accounted for just 6.6% of the market, the lowest share since 2022, according to the Australian Automobile Association. A cost-of-living crisis has pushed more EVs beyond the reach of buyers, while the nation continues to favor petrol- and diesel-powered pickups and SUVs.

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