Electric vs. Gasoline: Consumer Choices in the Automotive Market of 2025

Australia witnessed a groundbreaking milestone in its new-vehicle market in 2025, with a record-breaking 1,241,037 sales. However, delving into the details of combustion-powered, hybrid, plug-in hybrid, and electric cars reveals valuable insights into the preferences of different consumer segments towards specific vehicle types.

Buyers in the Australian market can be categorized into four distinct groups: battery-electric vehicles (EVs), plug-in hybrids (PHEVs), hybrids (HEVs), and the prevalent realm of petrol- and diesel-powered vehicles, which also includes mild-hybrids (MHEVs).

In terms of sales volume in 2025, the breakdown is as follows:

1. EVs: 103,270 sales (8.3% of the market) – including only two hydrogen fuel-cell electric vehicles (FCEVs)
2. PHEVs: 53,484 sales (4.3%) – with a small portion comprising extended-range electric vehicles (EREVs)
3. Hybrids (non-plug): 199,133 sales (16.0%) – encompassing conventional hybrids and self-charging systems like Nissan e-Power
4. Combustion (petrol/diesel, including MHEVs): 884,944 sales (71.3%)

EVs have established a significant presence in the market, primarily appealing to private and business buyers rather than rental companies. PHEVs are predominantly favored by private consumers, with minimal engagement from rental fleets. Regular hybrids, especially propelled by Toyota, have transitioned from a niche segment to a mainstream market segment, with a notable presence in rental fleets, indicating their status as a reliable fuel-saving option for businesses.

On the other hand, combustion vehicles (petrol/diesel and mild-hybrids) continue to be the preferred choice across all consumer segments, constituting over 70% of new vehicle sales.

EVs, with 103,270 units sold in 2025, account for approximately 8.3% of the total market share. Private buyers predominantly drove the demand for EVs, with business entities also playing a significant role, while rental companies showed minimal interest.

PHEVs, with 53,484 sales, represented 4.3% of the market and were predominantly purchased by private buyers. The breakdown of PHEV buyers included 65.3% private, 33.1% business, 1.2% government, and 0.3% rental.

Hybrids, totaling 199,133 sales, have become a mainstream choice in Australia’s automotive landscape, influencing fleet purchase decisions. The split of hybrid buyers comprised 58.0% private, 29.9% business, 3.8% government, and 8.2% rental.

Combining petrol/diesel vehicles with mild-hybrids, the total sales in 2025 amounted to 884,944, representing 71.3% of the market. Private buyers accounted for 46.2%, business buyers for 45.0%, government buyers for 2.7%, and rental buyers for 6.0%.

In conclusion, while EVs are gaining traction, their adoption is primarily driven by private consumers and businesses, with minimal interest from rental agencies. PHEVs have emerged as a popular choice among private buyers, with limited presence in rental fleets. Despite the dominance of petrol and diesel vehicles in terms of sales volume, hybrids, particularly conventional hybrids, have carved a significant niche in Australia’s automotive market, including a substantial portion of fleet demand.