Tesla resigns from car group over ‘misleading’ claims

Jennifer Dudley-Nicholson |

Tesla says claims a fuel efficiency standard would hike the price of petrol vehicles are false.
Tesla says claims a fuel efficiency standard would hike the price of petrol vehicles are false.

US automaker Tesla has spectacularly resigned from Australia’s peak automotive organisation, claiming the group is spreading “false and misleading” information about vehicle efficiency standards that could hurt the industry. 

The electric vehicle giant also referred claims from the Federal Chamber of Automotive Industries (FCAI) to Australia’s competition watchdog on Thursday, asking it to consider whether the group deliberately sought to deceive consumers. 

The letter follows more than a month of debate over the federal government’s proposed New Vehicle Efficiency Standard that would set a cap on emissions from automakers’ fleets to encourage them to bring more efficient vehicles to Australia. 

However, the chamber said in a statement it could not support a standard that had the potential to raise prices for some vehicles and needed to represent the needs of more than 50 brands other than Tesla. 

In a letter to FCAI chief executive Tony Weber, Tesla said it had “serious concerns about false and misleading public comments” made by the organisation, particularly around the price impact of efficiency standards.

“Over the past three weeks, Tesla considers that the FCAI has repeatedly made claims that are demonstrably false,” the letter said.

“Tesla is concerned that the FCAI has engaged in behaviours that are likely to mislead or deceive Australian consumers.”

A Tesla car charging
Tesla says car makers should be called out if they “knowingly spread misinformation”. (Dan Peled/AAP PHOTOS)

The car brand said it had referred some FCAI statements to the Australian Competition and Consumer Commission and planned to resign from the organisation at the end of the financial year.

Examples of misleading statements cited by Tesla in the letter included claims the price of petrol and diesel vehicles would rise after a fuel-efficiency standard and that the price of electric cars would plummet. 

“If consumers believe the FCAI’s false claims that electric vehicles are about to reduce in price by as much as 25 per cent next year, many will conclude they should also avoid purchasing one now,” the letter said. 

In a statement issued on Thursday afternoon, the FCAI confirmed Tesla had resigned its membership but said the group represented more than 50 car brands with more than 350 vehicle models and “just two are Teslas”.

The FCAI confirmed it did not support the proposed fuel-efficiency standard, even though it had been lobbying for an emissions cap.

“FCAI cannot support a standard that in the short-term might meet the needs and pockets of those at the premium end of the market while potentially hurting businesses and families who may be forced to deal with less choice and higher prices next time they buy a new car,” it said.

Energy Minister Chris Bowen said he welcomed Tesla’s stance and urged the transport industry to be more transparent.

“I welcome the support of Hyundai and Kia and Volkswagen and others, as well as, of course, peak motoring groups NRMA, RACQ, RACWA,” he said on Thursday.

“It is incumbent on everyone, on everyone in the debate, to provide full facts, proper facts, truthful facts.”

Electric Vehicle Council chief executive Behyad Jafari said fuel-efficiency standards in other countries shown to have reduced emissions and increased access to more efficient vehicles had also attracted “scare campaigns”. 

“It’s one thing for companies to represent their own interests and profits but when that veers into knowingly spreading misinformation, it’s important that gets called out,” he said. 

Tesla’s announcement comes days after public consultation into the New Vehicle Efficiency Standard closed, with the federal government to consult with the industry before introducing a standard in January 2025.

The coalition has opposed its introduction, with opposition transport spokeswoman Bridget McKenzie citing industry analysis that it could raise the price of some high-polluting vehicles by $25,000.

“A punitive tax is not the right way to push people towards EVs that are still not affordable or practical for many Australians,” she said.