EV Sales Are Up 65% — So Why Is Australia Still Behind?
EVs hit 3.39% of Australian car sales — a 65% jump. But policy gaps mean we're still trailing the world. Here's what it means for your novated lease.
Australia's electric vehicle market is growing fast. According to the Electric Vehicle Council's latest State of EVs report, EVs now represent 3.39% of all new vehicle sales — a 65% increase on the prior period. That's a meaningful shift. A few years ago, EVs were a curiosity. Now they're a real slice of the new car market.
But the same report is blunt: Australia is still well behind comparable countries. The reason isn't consumer appetite — it's policy. Weak fuel efficiency standards, inconsistent state-level incentives, and a thin charging network all drag on adoption. The EV Council's data makes clear that the countries leading the world on EVs got there through deliberate, consistent policy — not just market forces.
What this means for novated lease customers
If you're a PAYG employee considering a novated lease, this report matters for one practical reason: the window for the best EV novated lease conditions may not stay open forever. The Federal Government's FBT exemption on eligible EVs and plug-in hybrids is already in place — and that exemption is a significant driver of the cost difference between leasing an EV versus a petrol vehicle through salary packaging.
The EV Council's findings reinforce that government policy is the single biggest lever on EV affordability. Right now, that lever is working in your favour if you're considering an EV on a novated lease. Whether that continues depends on future policy decisions — which is exactly why timing matters. According to the EV Council report [Source 1], Australia's policy environment is the primary constraint on faster EV uptake, not consumer demand.
A novated lease on an eligible EV can reduce your taxable income and, under current rules, avoid FBT altogether on the vehicle benefit. The potential savings are real — but they depend on your income, the vehicle, and how the lease is structured. Use a calculator or speak to a broker who can run your actual numbers rather than quoting you a headline figure.
Common questions
Does the EV sales boom mean there are more models available to lease?
Yes, broadly. More manufacturers are bringing EVs to Australia, which means more eligible vehicles to choose from on a novated lease. Supply has been a genuine constraint — that's slowly improving as the market grows.
Why does Australia lag behind other countries on EV uptake?
The Electric Vehicle Council's report points to policy gaps — specifically the absence of strong fuel efficiency standards and patchy government incentives — as the main reasons. Consumer interest in EVs is growing, but infrastructure and policy haven't kept pace.
Is now a good time to get an EV on a novated lease?
The current FBT exemption for eligible EVs makes the numbers attractive under today's rules. Policy settings can change, so locking in a lease while the exemption applies is a reasonable approach — but run your own numbers first.
What counts as an 'eligible' EV for FBT exemption purposes?
Generally, battery electric vehicles and plug-in hybrids below the luxury car tax threshold, first held and used on or after 1 July 2022, can qualify. Check the ATO's guidance or speak to a licensed broker to confirm your specific vehicle.
Does millarX only do EV leases?
No — millarX arranges novated leases on petrol, hybrid, and electric vehicles. But right now, the policy environment makes EVs particularly worth looking at for eligible employees.