The Motor Industry Association has welcomed the Government’s decision to provide transitional financial relief and undertake a full review and overhaul of the Clean Vehicle Standard (CVS). The reset will help restore balance to the market, protect consumers from sharp price increases and better support real-world emissions progress.

Under the previous settings, the CVS had become a costly compliance market rather than an effective climate policy. Electric vehicle supply was pushed ahead of actual demand, leaving many importers unable to earn enough credits and facing rising penalties and credit costs – pressures that ultimately risked higher prices and reduced choice for consumers.

The Government will temporarily cap CVS penalties at $15 per gram of CO₂ for two years while a new framework is designed. This provides immediate relief and stability for businesses, reduces the risk of sudden vehicle price hikes, and gives the sector time to plan and invest in the technologies that genuinely lower emissions.

MIA Chief Executive Aimee Wiley says the association supports progress towards a cleaner fleet, but believes policy must be achievable and grounded in real market behaviour. MIA will work closely with Government on a simpler, more effective “version two” of the Clean Vehicle Standard that remains ambitious while supporting customer choice and delivering measurable emissions reductions over time.