Pivoting towards electromobility

January 9th, 2023

INTERVIEW

T&T’s automotive sector moves ahead
Change is inevitable and this is evident in T&T’s automotive sector; the country is moving from Driver’s Permits to Driver’s Licences, deemed to be more secure, modern and internationally recognised. On the move also is the Licensing Division which launched a mobile service in late 2021. Citizens can access services from two fully outfitted buses at various locations throughout the country.

While motorists may welcome this change, one that has not settled well is the recent hike in fuel prices.

In April, the price of premium and super gasoline each rose by TT$1 per litre to $6.75 and $5.97 respectively, diesel was adjusted by TT$0.50 to TT$3.91 per litre and kerosene increased to TT$3.50. Electric and hybrid buyers, however, are pleased with the Government’s decision to remove all custom duties, motor vehicle tax and value added tax (VAT) on the importation of two-year-old battery-powered electric vehicles. As of 25 May 2022, all taxes (customs duty, motor vehicle tax and VAT) have been waived on passenger hybrid motor cars for private use with an engine size not exceeding 1,599 cc and an electric motor output not exceeding 105 KW.

The way forward – electromobility

According to Dr. Graham King, “Globally, we are going through a huge transition in the automotive sector and that transitioning is really pivoting towards electromobility (emobility) across basically all transportation sectors.” The engineer said there are some big advantages to electric vehicles which are generally beneficial but for small islands, the benefit is amplified. However, he shared, “Manufacturers are not really prioritising our region with the supply of vehicles and that is going to be a bit of an ongoing problem because of the minerals it requires to manufacture the electric vehicle batteries. The demand for lithium and the other minerals that go into battery manufacturing is exceeding the supply but there is a lot of investment taking place in starting to meet that need and building the supply chain.

As far as I can think, there are three models that are being sold by franchise dealers, but the foreign car dealers are able to source their vehicles much more widely. There are things I think the franchise dealer could do to improve their supply. These islands are so small it makes perfect sense to run electric vehicles. It would be great if the franchise dealers could speak to each other and present a united front. It would help to give a voice to the Caribbean and to the manufacturers.”

While there are many advantages to electric vehicles, Dr. King explained that there will be the same number of vehicles on the road. “The problem we have is congestion and I think we underestimate its cost to the economy and to productivity.” What does he suggest can be done to ease congestion? “With the advent of emobility, there is a huge possibility to transition to a more modern and efficient public transport system,” he said, “but this has to be driven by the Government.” He also pointed out that a properly formulated transportation plan is necessary.

Attracting investment

So, what could be done to attract investors? He noted that there is some investment taking place as with Unipet and charging infrastructure for electric vehicles. “People will want to have public chargers and especially destination chargers (like those currently available in Preysal, 100% renewable, and Brentwood gas stations) but right now the charging network is very limited.”

The final area where we think action is needed is to secure cross and across-border gas supplies to be imported via pipeline. There are significant gas resources in neighbouring territories, especially in Venezuela, Barbados and Grenada. In addition to significant untapped offshore gas fields off Venezuela’s north coast, there are significant volumes of associated gas produced onshore Venezuela that is currently flared. The gas flared exceeds the current demand shortfall in Trinidad and Tobago.

Projected outlook

Slow growth in number of electric vehicles in T&T

What is Dr. King’s projected outlook for the sector? “I embrace the VAT and duty waivers for electric cars at this time but for hybrids, I think it is a big mistake. It is going to cost the Government potentially
US$50 million a year and they’re not getting anything back from that. They could have taken that and invested it in developing the transport system and it could have made people’s lives a lot easier.”

Cabinet though has agreed to convert the fleet of Public Transport Services Corporation buses to electric buses. While the remaining internal combustion engine buses will still be used, Works and Transport Minister Rohan Sinanan believes the move to electric needs to be done to reduce emissions and to move with the rest of the world.

Dr. King further explained that the growth of electric cars he was hoping to see may not happen because of the waiver on hybrids. He thinks people are going to revert to buying hybrids and there will be a big increase in those buying private vehicles – “more and more vehicles these days have some sort of hybrid system.”

Additionally, he thinks there will be consistent growth in larger vehicle sales as more models become available. “Manufacturers now, in response to legislative actions by countries in the west especially, are committing to phasing out internal combustion engine vehicles and going electric and they are investing large amounts of money in developing electric vehicles. So, vehicle models are growing every day and are finding their way in,” he said.

CNG good retrofit with a lifespan

As for CNG, Dr. King sees it as a good retrofit option but pointed out that it is definitely not the future. “That has a lifespan but for now it is still good, especially for high mileage vehicles.”

About Dr. Graham King –

Dr. King’s background is as an Automotive Engineer, with 16 years of experience in the automotive industry in the UK and Germany, focusing on innovation in the application of new technology. He worked for major motor manufacturers in Research and Development, with stints in Manufacturing, and on staff at the University of Warwick focusing on boosting the competitiveness of automotive manufacturers and the supply chain.

Dr. King took up the post of Director of STACIE in August 2022. As Director of STACIE, he chairs the UWI St. Augustine Innovation Committee and the Intellectual Property Sub-Committee.

Dr. Graham King strategically oversees STACIE to ensure implementation, monitoring and evaluation of programmes, projects and activities according to UWI’s strategic objectives. He leads the financial planning, human resource management, marketing planning and innovative strategies for sustaining STACIE’s reach and impact. Dr. King builds relationships with industry leaders and government agencies, and regional and international bodies to source information, funding and technical expertise.

https://sta.uwi.edu/stacie/team/dr-graham-king

Extracted from the Who’s Who in Trinidad & Tobago in Business, 2022-2023 publication.