Electric Vehicle sales reach half of all car sales
Updated ,first published
Electric vehicles have reached a new milestone, reaching almost half of all new vehicle sales last month, highlighting the potential for clean cars to defy skeptics and help Australia meet its climate targets.
The government’s 2035 climate target was deemed unattainable by many commentators last year when the independent Climate Change Authority, chaired by former NSW Treasurer Matt Kean, announced that half of all vehicles would need to be electric for Australia to meet its target.
Industry figures announced today show that the target may not actually be that realistic.
Whether people regret their electric vehicle choice is another matter, and could result in the rollout of charging stations needed to keep the growing EV fleet running.
Figures released Wednesday by the Federal Chamber of Automotive Industry and the federal Agency for Climate Change, Energy, Environment and Water showed that 48 percent of all vehicle sales in May were either fully electric vehicles, conventional hybrids or plug-in hybrids.
This falls short of the Climate Change Agency’s finding that electric vehicles must account for 50 per cent of all sales in the decade to 2035 for Australia to meet its target and reduce emissions by at least 62 per cent.
But it shows drivers’ growing willingness to give up petrol and diesel since the Iran war has created a global oil shock, driving up fuel bills and signaling the possibility Australia may have to ration petrol or diesel.
21 percent of all cars sold in May were electric, and 9 percent were plug-in hybrids. The overall figure for electric motor vehicle sales rises to 48 percent of the market when traditional hybrid vehicles, which have an electric motor but cannot be recharged, are included.
Approaching the 50 percent milestone, combined with exponential growth in EV sales, the falling cost of all-electric vehicles, and automakers’ increasing focus on EVs as opposed to hybrids, means it’s now a reasonable possibility.
A key to future sales growth will be the controversial rollout of charging stations.
Lobby group the Electric Vehicle Council said state and federal governments needed to offer more financial support if they wanted to hit emissions targets.
Although the transportation sector is the second largest source of greenhouse gas pollution after electricity generation, its emissions fell by only 0.6 percent in 2025. Despite the increase in EV sales, gasoline car purchases have also increased with the population.
“When petrol prices rose, Australians had an alternative to the bowser and they chose it in record numbers,” council leader Julie Delvecchio said.
“While the government has rightfully invested in charging infrastructure and as adoption increases, federal, state and local governments need to work together to redouble efforts to meet demand.
“We need to make sure the infrastructure keeps up with this increase so that when Australians choose electricity, the charger will be there when they arrive.”
Generous tax breaks have helped boost EV uptake. The federal government kept the benefits tax exemption for electric vehicles priced under $75,000 in the May budget. But the discount will be rolled back for vehicles priced above $75,000, leaving only a 25 per cent reduction in fringe benefits tax from April 1 next year.
Energy Minister Chris Bowen said the government’s policies to support EV uptake were helping drivers save on petrol costs.
“We want Australians to have access to cheaper cars that suit their family’s needs,” Bowen said.
“Under Labor, electric vehicle charging has effectively tripled, with a combination of market and government support showing a robust rollout of charging infrastructure.”
But last week it was revealed the government had dropped its commitment to partner with the NRMA to build 117 electric vehicle charging stations on key motorway routes, reducing the number of charging stations to 77 and reducing funding from $39 million to $27 million.
Government officials told a Senate estimates hearing in May that the reduced funding would be enough to close key network gaps.
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Mike Foley is the climate and energy correspondent for The Age and The Sydney Morning Herald.Connect via email.
Shane Wright is senior economic correspondent for The Sydney Morning Herald and The Age.Connect with: X or email.
