EV sales in Australia drop to lowest level in two years: AAA

The EV industry in Australia has suffered a massive hit, with some experts claiming a recovery might never be possible.

Electric vehicle sales in Australia have sunk to their lowest level in two years as more Aussies turn to the ‘range safety’ of traditional combustion engines or plug-in hybrids.

Data from the Australian Automobile Association revealed just 17,914 EVs were sold in the first three months of 2025 or just over 6 per cent of all vehicle sales in the country.

The AAA quarterly vehicle report showed the last time EV sales were at that level was in 2023 when 17,396 cars were sold during the same period.

The 2025 data also shows EVs have dropped market share when compared to the final three months of 2024 – 21,331 EVs were sold in the last quarter of 2024 to make up 7.42 per cent of the country’s vehicle sales.

That represents a drop of 1.12 per cent in market share quarter to quarter.

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EV sales in Australia have dropped to a two-year low. Picture: NCA NewsWire/Naomi Jellicoe

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Industry experts say the government’s attitude to EV subsidies has a massive part to play in consumer sentiment.

Federal Chamber of Automotive Industries boss Tony Weber told carsguide.com.au he doesn’t believe EV sales can recover without proper government support.

“Subsidies remain central to the success of EV policy in many leading markets. In European markets and other markets around the world, including New Zealand, demand for electric vehicles softened when governments reduced subsidies,” he said.

While the drop would be of some concern to the EV industry it hasn’t come at the expense of the environment.

While Aussies have steered slightly away of outright EVs, it hasn’t been a return to petrol-only engines either.

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Federal Chamber of Automotive Industries CEO Tony Weber believes EV sales will only increase with government support.

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Hybrid vehicles have boomed as Australians look for an environmental alternative that also includes the safety net of a combustion engine that allows greater distance range and less time to charge and get going.

Plug-in hybrid sales almost doubled in the first three months of 2025 to 13,698 or almost 5 per cent of the market. That’s up from 7556 sales (2.63 per cent) in the last quarter of 2024.

The number of conventional hybrid vehicles sold increased from 42,618 to 46,115 over the same period.

Vehicles with traditional petrol engines continued to make up the vast number of sales in Australia for the first quarter of 2025 but did experience a drop.

EVs are flooding into Australia from China but less people are buying them in 2025.

More than 206,800 vehicles were sold, comprising 72.68% of all sales in Australia. Those figures represent a drop of about 10,000 sales and almost 2.5 per cent market share compared to the end of 2024.

Despite the drop in EV sales, the industry is confident transactions will recover.

“We expect that segment of the market to bounce back given a post-FBT exemption dip was always to be expected,” Electric Vehicle Council’s Aman Guar told carsguide.com.au.

“Once someone chooses an EV of any kind they are very unlikely to ever go back to traditional cars again. The day-to-day convenience, the pleasurable driving experience, and the cost of living benefits of EVs combine into a very attractive package and these attractions are only going to grow stronger.”

Originally published as EV sales in Australia drop to lowest level in two years: AAA