Carmakers have reportedly reached the "limit" of early adopters willing to purchase electric vehicles (EVs), according to Damien Meredith, CEO of Kia Australia, amid a noticeable decline in demand for battery-powered cars.

Meredith discussed the issue with local media, acknowledging the challenge, particularly as upcoming emissions standards in 2025 will require carmakers to sell more hybrid and electric vehicles to offset emissions from high-polluting models and avoid government penalties.

"It's a difficult situation," Meredith stated in response to the slowdown in the EV market.

"However, there are factors in play that necessitate the sale of more EVs; this is a reality with the New Vehicle Efficiency Standard (NVES). Other manufacturers may be emphasising that portion of the market, but the fact is, we view it as needing to essentially double what we are currently doing to meet our NVES requirements. And that is our strategy, our plan, our sales mix, and we will proceed accordingly," he further added.

Meredith also noted that the early adopter market for EVs has been saturated, presenting the challenge of engaging the broader public, who are generally less inclined to embrace new technologies.

"We have definitely reached the early adopter limit, without a doubt. Now, we are entering the mainstream market, and it is a slow process," he explained.

The New Vehicle Efficiency Standard does not mandate a specific proportion of new-car sales to be electric, but it will impose CO2 emissions targets on each vehicle sold.

Manufacturers can continue selling high-emission models, such as diesel utes (pick-up trucks) and 4WDs, including Kia's upcoming Tasman ute, but they must offset these with sales of low- or zero-emission vehicles that meet CO2 targets to avoid significant penalties.

Kia aims to sell around 10,000 EVs in 2025, alongside a similar number of hybrids, while continuing to offer petrol and diesel models across its line-up of small hatchbacks, family SUVs, and utes.

Approximately half of these EV sales are expected to come from the newly launched EV5, although the initial forecast of 10,000 units has been revised down.

Overseas, strict emissions standards and EV mandates, such as those in Europe, have been softened in recent months, leading to speculation about whether similar adjustments could occur in Australia.

"We can only plan based on what is currently in place," Meredith commented. "The legislation will take effect on 1st January, with penalties starting on 1 July, and that is what we are planning for. In the meantime, there will be a federal election, so these variables may change significantly - who knows?"

Meredith reaffirmed Kia's strategy to balance its vehicle mix to ensure compliance with emissions regulations, avoid penalties, and remain competitive in the market.

"The car mix is designed to ensure that we avoid penalties, while still offering competitive prices, which is extremely important to us and our strategy," Meredith said.

Despite the cooling demand for EVs, Kia Australia's General Manager of Marketing, Dean Norbiato, noted strong initial interest in the company's latest EV, the EV5 SUV.

"The initial results, in terms of test drives and page views for the EV5, have far exceeded those for any other model we have launched," Norbiato remarked.

"While there is some pessimism surrounding EVs, we believe we have a product that resonates well. The EV5 is positioned alongside the Sportage, Sorento, and Carnival. If the right product and package are introduced to the market, there is clear interest," he further added.

He also said that Kia plans to follow up with the EV3, targeting the small SUV market, Australia's third-largest vehicle segment after medium SUVs and small cars.

Meredith concluded: "We focus on strategy, operations, and results. We have established a strong strategy, executed it effectively, and achieved solid results."