New behavioural research shows working families in outer suburbs are the keenest to buy electric vehicles, but would be hardest hit if incentives were switched off and new road user charges were introduced.
Families in Australia's outer suburbs are turning to electric vehicles as petrol prices surge, but face new taxes on driving electric under plans by the Federal and NSW Governments, that would cut across their promise not to discourage EV uptake.
In September 2025, the Federal and State Treasurers pledged that reforms to road user charging "should be designed to not deter the continued take‑up of electric vehicles."
The Minns Government is set to begin taxing EVs 3c/km, potentially from next year, and the Albanese Government is actively planning its own tax.
Twenty eight percent of Australian drivers who are likely to buy an electric vehicle would be dissuaded by these proposed road user charges, according to new behavioural research by Professor Simon Jackman, Honorary Professor at Sydney University.
"It's clear that drivers aged 30-55, and those in outer suburbs and regions would be most discouraged from EV purchase intentions after being informed of the Road User Charge they would pay, " said researcher, Professor Simon Jackman.
"Older drivers and those in wealthier, more professional postcodes are the least affected."
The behavioural research of 3,613 Australian drivers identifies that working families aged 30 to 55 living in the outer suburbs are the most interested in buying EVs, but also those most deterred by a road user charge. These families drive further than average, have longer commutes, are under-serviced by public transport. They are motivated primarily by fuel savings, and are driving the growth of EVs in Australia.
Just as Australians are struggling with higher fossil fuel prices as a result of the Iran War, the average driver would be hit with $353 a year in new taxes for driving an EV.
Energy Minister Chris Bowen's electorate is home to suburbs most turned off EV purchases by a road user charge. In suburbs like Kemps Creek, 33% of likely EV buyers are discouraged. In Brisbane it's Treasurer Jim Chalmers electorate that is most sensitive to the charge, Parkinson in the Treasurers electorate or Rankin similarly turned off.
Electric Vehicle Council CEO Julie Delvecchio said:
"Australians are turning to electric vehicles to escape rising petrol — but a new road user charge could hit drivers with around $353 a year in extra costs, wiping out the very savings driving this shift."
"The nation's Treasurers have pledged not to implement a road user charge that discourages EV uptake but this research finds that a charge like the one being proposed would do exactly that - turn off interest from people who stand to gain the most by driving electric."
"We know cost is everything. One in three Australians say the upfront price is the biggest barrier to buying an EV — and right now the FBT exemption is what's helping households get over that hurdle."
"At the same time, 47 per cent of EV drivers say lower fuel costs are the main reason they switched— so introducing a per-kilometre tax directly undermines the biggest benefit."
"This isn't evenly felt. In outer suburban areas like Kemps Creek, around 33 per cent of potential EV buyers are deterred by a road user charge — compared to about 20 per cent in wealthier inner-city areas."
"EV drivers travel about 60 per cent further each week than petrol drivers— so adding a per kilometre charge hits the very people using EVs as a cost-of-living solution."
"If the government removes the Electric Car Discount and adds a new tax on every kilometre, it's a double hit — higher upfront costs and higher running costs — and that's exactly what stops people switching."
"We've seen what happens when policy gets this wrong. In New Zealand, EV sales dropped from 20.6 per cent of the market to just 3.8 per cent in months after incentives were cut and charges introduced."⁴
"The Climate Change Authority is clear — Australia needs more than five million EVs on the road by 2035, which means around half of all new cars sold need to be electric."⁵
"You don't get there by making EVs more expensive to buy and run — especially for the working families in the suburbs who are driving uptake."
Key findings
The research was conducted by Professor Simon Jackman using a nationally representative sample of 3,613 adult car owners, in December 2025. Each respondent was shown a personalised road user charge based on their actual driving at 3 cents per kilometre — the approximate trajectory of the NSW scheme. Purchase intention was measured before and after at an individual level.
The deterrent effect:
- 28% of all likely EV buyers are dissuaded after seeing their personalised road user charge
- 48% of "extremely likely" buyers downgrade their purchase intention
- 34% of "somewhat likely" buyers are deterred
Who is most affected:
- Working families aged 30–55 — the most deterred age group. Over-60s are barely affected.
- Outer-suburban postcodes — ~30% of likely buyers deterred, vs ~20% in wealthy inner-urban areas.
- Blue-collar communities — significantly more deterred than high-professional postcodes.
- Most affected electorates: McMahon, Blaxland, Watson, Greenway, Werriwa,Fowler, Lindsay, Chifley (Sydney); Hotham, Gorton, Calwell, Holt (Melbourne); Rankin, Dickson, Forde (Brisbane).
Record EV sales at risk
These findings come as Australians are adopting EVs at record rates:
- Battery EV sales up 95.9% year-on-year in February 2026 (11,134 vs 5,684)
- Total EV sales up 60.9% in February (16,988 vs 10,555)
- Year-to-date EV market share at an all-time high of 16.8%, with BEVs at 10.5%
- February 2026 EV market share reached 18.6% — nearly one in five new cars sold was electric
The fuel security context
Australia imports 90 per cent of its liquid fuel and has lost 70 per cent of its refining capacity in the past 15 years. Last week, the government took the unprecedented step of releasing 760 million litres from the national fuel stockpile. Petrol prices have surged past $2.20 a litre, with analysts forecasting $3 while the Strait of Hormuz remains closed. Every EV on the road is a vehicle that does not depend on imported petroleum.
Methodology
The behavioural research was conducted by Professor Simon Jackman using a nationally representative online panel of 3,613 Australian adult car owners (December 2025). Each respondent was shown a personalised RUC based on their self-reported driving at 3c/km. Purchase intention was measured before and after on a five-point scale. Individual-level transition matrices were used to calculate downgrade rates. Accumulated Local Effects (ALE) analysis from a boosted regression model identified demographic and geographic predictors of deterrence.
—
