The Government has decided to keep the clean car standard, ending more than a year of speculation that the rule requiring vehicle importers to bring in cleaner cars would be scrapped altogether.
Transport Minister Chris Bishop announced the decision on Friday afternoon, saying the Government would retain a Clean Vehicle Standard for both new and used vehicle imports after a review of how it is set up. “The first stage of that review was carried out earlier this year. It found the Standard to be the most cost-effective way to increase the availability of lower-emissions vehicles in New Zealand,” Bishop said in a statement released on 21 August 2026. “Most vehicle industry stakeholders who took part in the review also supported retaining the Standard.”
Bishop said industry feedback had weighed heavily. “In feedback on the review, industry noted that the Standard is now well established in New Zealand, with importers accumulating credits and charges over time. Removing it at this stage would be highly disruptive for the vehicle industry,” he said.
What has not been decided is the part that actually costs money. The Government has agreed only that a standard will exist. The numbers behind it, meaning how much carbon dioxide a company’s imports are allowed to average each year before charges start, will be worked out later. Bishop said officials would now talk to the vehicle industry about the settings and report back early next year, and that any new targets would take effect from 1 January 2028. He also said the Government had agreed to set separate targets for used imports “to reflect that they have different and older technology”.
The standard works as a fleet average rather than a rule about individual cars. Every importer, from the large franchise distributors down to small used car yards bringing vehicles in from Japan, is measured on the average emissions of everything it lands in a year. Come in under the target and the importer banks credits. Come in over it and the importer is charged for every gram above the line, multiplied by the number of vehicles. Nothing stops anyone importing a large ute or a V8. The system simply makes it more expensive unless the same importer also brings in enough hybrids, small petrol cars or electric vehicles to pull the average down.
The current target is 108 grams of carbon dioxide per kilometre for 2026, dropping to 103 grams in 2027, according to Motoring NZ. Those figures are what the second stage of the review will now revisit.
The standard was introduced by the previous Labour government in 2023, alongside the clean car discount, which paid rebates on low emission vehicles and charged fees on high emission ones. The coalition scrapped the discount in its first weeks in office but kept the standard, and has since softened it twice. The larger of those changes came in November 2025, when charges were cut by close to 80 percent. The rate for new vehicles fell from $67.50 to $15 for each gram over the target, and the rate for used vehicles fell from $33.75 to $7.50, as summarised by Drive Electric. Existing credits were also protected from expiring before the end of 2028.
At the time Bishop framed that decision around household budgets. “At a time when Kiwis are still feeling the pinch, the last thing they need is the cost of cars going up,” he said in November 2025. The same reasoning appears in Friday’s announcement, which noted that most importers had been struggling to meet the passenger vehicle targets and that the charges were likely to be passed on to buyers through higher prices and less choice.
Abolition was a live option until this week. In March 2026 Bishop told RNZ that because the review started from first principles, scrapping the standard was “obviously” on the table. Analysts pointed out at the time that removing it would leave New Zealand as one of only two countries in the OECD without a vehicle emissions standard, the other being Russia.
Industry groups had split on the question, though not in the way the debate was often described. The Motor Industry Association, which represents new vehicle distributors, wanted the standard kept but reset. Chief executive Aimee Wiley said in March that it should be retained “with the emissions trajectory recalibrated to reflect domestic affordability and realistic product availability”. That is close to what the Government has now landed on.
Drive Electric, which advocates for electric vehicle uptake, had argued against removal on supply grounds rather than climate grounds alone. Chair Kirsten Corson said in March that “we’re really alarmed that there’s the potential of removing the standard completely, because the rest of the world is going in the other direction”, warning that without a target manufacturers would send their cleaner models to markets that required them and “New Zealanders are sold the high-emitting leftovers”.
The decision lands in an unusual position on the political calendar. Officials will not report back on the actual settings until early 2027, well after the general election on 7 November. Whoever is in office then will make the calls that determine whether the standard bites or simply exists on paper. Voters weighing up transport and climate policy before polling day can compare where the parties stand using the Newswire voting tool.
It is also the second climate-related decision in a week where the substantive work has been pushed past the election. Cabinet documents released on Thursday showed officials had been told to develop new emissions reduction options and report back after November. Transport is one of the largest sources of carbon dioxide in New Zealand outside agriculture, and light vehicles are the bulk of it, which is why the fleet turns over slowly and why decisions about what gets imported this year still show up in emissions figures well into the 2030s.
For car buyers, nothing changes immediately. The current rates and targets stay as they are through 2026 and 2027. The difference will be felt from 2028, and only once the numbers nobody has seen yet are settled.
What do you think of the decision to keep the clean car standard? Should the targets be tightened or loosened when the settings are reviewed? Leave a comment below and let us know.
This article was written by AI, briefed to report the facts, hopefully without some of the bias people bring to the job 🙂
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