New record for electric cars as ICE age declines

Sales of battery electric vehicles (BEVs) achieved the strongest quarter to date in the three months to 30 June 2025, reaching 9.3 per cent of new car sales and 22 per cent of Australia‘s most popular vehicle segment, while sales of pure internal combustion engine (ICE) vehicles dipped to 72 per cent, its lowest result to date. 

The new results, released by the Australian Automobile Association (AAA) on Thursday, show 29,244 BEVs were sold from April to June, an increase of 3891 vehicles compared to the same period in 2024. This was also a sharp rise from the 17,901 BEVs sold in the March quarter, lifting market share from 6.3 to 9.3 per cent. 

Sales of hybrids were down slightly by 0.6 per cent year-on-year, claiming 14.87 per cent market share compared to 14.93 per cent last year (with volume all but flat: from 46,727 down to 46,732.) They still remain more popular than battery electric vehicles, which last overtook hybrids in Q2 2023. Despite quarterly fluctuations, hybrids have grown strongly over the past two years, outselling BEVs in eight consecutive quarters. However, the June result marks their lowest market share since Q1 2024. 

Meanwhile, plug-in hybrid electric vehicle (PHEV) sales are up from just 1.5 per cent in Q2 2024 to 3.8 per cent in the latest quarter. This represents a decline from 4.8 per cent in the March quarter, with total sales falling from 13,711 to 11,902. The AAA points to the end of Fringe Benefits Tax exemptions for PHEVs on 31 March as a likely factor in the drop. 

With car sales across the board up by just 1300 vehicles (from 312,889 to 314,185 quarter-on-quarter), overall picture shows interest in electric and electrified vehicles is continuing to climb. ICE sales still dominate, with 226,306 sold in the quarter, but market share has steadily eroded from more than 86 per cent in early 2023 to just over 72 per cent today. 

Mid-size electric SUV sales reach 22 per cent 

The AAA’s EV Index shows BEVs are making inroads in certain market segments. Medium SUVs remain Australia’s most popular new vehicle type, making up 24.6 per cent of all light vehicle sales in Q2.  

Among medium SUVs, BEVs captured 22.2 per cent of sales, the highest proportion on record. That’s more than double the March quarter figure of 10.9 per cent, and up from the previous high of 22 per cent in Q2 2023. 

Hybrids also have a strong foothold in the medium SUV space at 23.9 per cent, with ICE models still leading at 47.8 per cent. PHEVs accounted for 6 per cent of medium SUV sales. 

In medium passenger cars, BEVs dominate with 42.6 per cent of sales, followed by hybrids (33.2 per cent), ICE (22.7 per cent) and PHEVs (1.5 per cent). 

Until recently, PHEV sales were concentrated in the medium SUV segment. That changed this quarter with the arrival of the BYD Shark 6 PHEV 4WD ute, which alone accounted for 47 per cent of all PHEV sales and 9.2 per cent of all 4WD ute sales.  

While ICE vehicles still hold the lion’s share of the Australian market, the steady increase in BEV and electrified vehicle uptake – particularly in popular SUV segments – suggests the transition to electric is gaining traction, even if the pace varies across fuel types and buyer segments.