Mazda Australia has confirmed that vehicle prices will increase to offset fines incurred under the New Vehicle Efficiency Standards (NVES), as the company's new hybrid system is not expected to be introduced for at least another 12 months.

Mazda Australia Managing Director Vinesh Bhindi stated that the price increases would not be directly tied to individual models or engines. For example, if a CX-5 Turbo incurs a fine, that specific amount would not be added to its retail price. However, customers would be informed of the underlying reasons for the adjustments.

"Compliance means that if emissions exceed the targets, fines are imposed. If this aligns with consumer demand, and customers are informed, a portion of the fines will be reflected in the pricing," Bhindi said.

"It is not a direct correlation, as these considerations occur behind the scenes. It is not a simple case of 'this car equals this fine', but rather a broader consideration of the brand's overall position. If there is an assumption that pricing will not be affected - an assertion made by some politicians when it suits them - that assumption is inaccurate.

"There is a cost associated with adopting new technologies. Battery systems and other components are expensive, and these costs need to be included.

"How much this will cost, and when it will apply, is still being determined. The broader transition requires reductions in CO2 emissions, and this is expected to influence pricing."

NVES enforcement began on 1st July. Each CX-5 Turbo sold - emitting 191 grams of carbon dioxide per kilometre against a target of 148g/km - is expected to incur a fine of approximately AUD 4,300 (US\$ 2,800) per vehicle, based on a penalty of AUD 100 per gram of CO2 exceeded.

Manufacturers may receive discounts for early payment of fines. However, Mazda Australia does not currently offer a battery electric vehicle (BEV) capable of generating credits to offset these penalties.

Annual emissions targets will become more stringent, potentially increasing financial penalties if lower-emission powertrains are not introduced.

Mazda is developing a full-hybrid powertrain based on the forthcoming Skyactiv-Z petrol engine family, which is scheduled to debut in the third-generation CX-5. The system is unlikely to be introduced in Australia before 2027.

In the meantime, Mazda offers plug-in hybrid powertrains in the CX-60 and CX-80 models. This technology is also expected to be used in the CX-70 and CX-90.

These models, built on Mazda's Large Product Group platform, are equipped with inline six-cylinder petrol or diesel engines that include mild-hybrid technology.

When asked whether Mazda would consider purchasing emissions credits from other manufacturers, Bhindi indicated that the option had not yet been explored but could be considered in the future.

"There are currently no discussions with other companies. However, if that becomes necessary, it could be an option," he said.

"The current priority is to maximise the efficiency and potential of the existing product portfolio."