Guest post by Patrick Peterson
As eco-friendly electric vehicles (EVs) have gained popularity, so has the demand for shipping EVs worldwide. However, concerns, mostly related to battery safety, have resulted in strict regulations associated with shipping electric vehicles overseas. Nowhere are these shipping concerns more apparent than in Australia, where, according to The Guardian, the total number of EVs in Australia nearly doubled in 2022, from 44,000 to more than 83,000, and that trend is expected to continue.
This article explores the key challenges of shipping electric cars from the US to Australia. It discusses regulatory compliance, including import regulations and vehicle standards, logistical issues such as shipping costs and battery concerns, financial implications like import taxes and currency exchange rates, and the compatibility of EV charging infrastructures. It also addresses insurance and warranty considerations and provides real-life examples to illustrate the process of shipping electric vehicles overseas.
Regulatory Compliance
The Australian government requires import approval before shipping a car from the USA to Australia. According to Section 22 of the Road Vehicle Standards Act 2018 (RVSA), importing a road vehicle into Australia without approval from the Department of Infrastructure, Transport, Regional Development, and Communication of the Arts is an offense. The approval process is handled through ROVER, the department’s online application and approval portal.
One notable way Australia handles EV vehicles being imported into the country is that, according to the Australian Border Police, since July 2022, customs duty on EVs with a lower customs value than the country’s fuel-efficient luxury car tax threshold will be duty-free.
An imported EV must meet Australian Design Rules (ADRs) to be deemed “road-legal” in Australia. These rules govern emissions, anti-theft measures, and safety. These rules apply to new and used EVs imported, sold, or introduced to the Australian car market for the first time.
Shipping Logistics
Although shipping a car from the USA to Australia can be a challenge in and of itself, shipping electric vehicles overseas has its own unique set of shipping logistics, particularly because of their large lithium-ion batteries, which are considered hazardous materials.
Challenges include:
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Size and weight: An EV’s battery pack is usually bulky and heavy, making transport difficult.
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Hazardous material classification: EV battery packs contain lithium-ion cells, which are “hazardous,” making electric vehicle transport dangerous.
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Thermal runaway risk: When lithium-ion batteries are subjected to high temperatures and other stressors, thermal runaway can occur. This may cause the EV battery to explode or catch fire.
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Specialized equipment and training: Electric vehicle transport requires specialized equipment and training. Therefore, anyone handling EVs during the shipping process needs to be trained in the safe transport of hazardous materials and in using appropriate equipment, like pallet jacks or forklifts designed for heavy loads.
Despite these unique challenges, electric vehicle transport between the US and Australia has become increasingly common. However, these factors can also affect the cost and timeframe of shipping electric vehicles overseas.
Shipping an EV from the US to Australia will cost anywhere from $800 to more than $3000, depending on the shipping method, vehicle type, distance, import fees and duties, and cleaning charges. The estimated turnaround time for shipping a car from the USA to Australia is about 30 days.
Financial Implications
Under the Australian Customs Tariff, goods imported into the country are subject to duties unless exemptions apply with a top duty rate of 5%. However, there is no customs duty on imported electric vehicles with a customs value lower than the fuel-efficient luxury car tax threshold. The Australian Government levies the luxury car tax at 33% of the car’s value, which exceeds the threshold (AUD 91,387 for fuel-efficient vehicles and AUD 80,567 for other vehicles). It is payable on the GST-exclusive value above the threshold.
It is important to note that currency fluctuations and exchange rates between the US and Australian dollar can have wide-ranging impacts, affecting the overall cost of purchasing and shipping a car from the USA to Australia.
Insurance and Warranty Issues
According to a recently released report from the Insurance Council of Australia, securing insurance for imported EVs presents several challenges, including higher insurance premiums and limited coverage options. Imported EVs often require original manufacturer parts, which may be expensive or delayed due to supply chain issues.
Many technicians must be trained to repair specific EV models, increasing repair costs. Imported EVs may also have warranty issues, as manufacturer-backed coverage might not apply in Australia. Without local support, EV owners may face compatibility issues with charging infrastructure and lose access to software updates.
Charging Infrastructure and Compatibility
EV charging standards in the US and Australia differ significantly, including plug types, onboard chargers, and overall charging standards. This means EV imports from the US to Australia may need adapters or modifications. Even then, many experts argue that there are insufficient EV charges across Australia’s 7.7 million square kilometers. However, for most buyers of imported EVs, home charging is sufficient.
How to Prepare an EV for Shipping Overseas
Before you ship an EV overseas, there are several steps you should take:
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Ensure the battery is charged to the recommended level (usually about half) and securely fastened.
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Perform a full vehicle inspection and gather essential documents, including proof of ownership and compliance certificates, and a car history report to verify the vehicle’s legal status and condition.
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Clean the car, remove personal items, and secure any loose parts.
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When choosing a shipping company, select a reputable provider experienced in EV transport and communicate any specific needs.
This type of preparation and the knowledge gained through this article will ensure a smooth and safe shipping process.