Australia's EV Sales Are Booming — So Why Are We Still Behind?
EV sales hit 3.39% of all Australian vehicle sales — a 65% jump. Here's what the policy gap means for novated lease customers eyeing an EV. Read on.
Australia's EV market is growing fast. According to the Electric Vehicle Council's latest State of EVs report [Source 1], electric vehicles now represent 3.39% of all new vehicle sales — a 65% year-on-year increase. That's a real number, not spin. Australians are buying EVs in growing numbers despite, not because of, the policy environment.
The catch? Compared to markets like Norway, the UK, or even New Zealand, Australia is still well behind. The EVC report is direct about why: policy settings haven't kept pace with consumer demand. Charging infrastructure, import supply, and fleet incentives all lag behind peer nations.
What this means for novated lease customers
If you're an Australian PAYG employee thinking about an EV through a novated lease, the policy context matters. The federal government's fringe benefits tax (FBT) exemption for eligible electric vehicles — introduced in late 2022 — is one of the few policy levers that directly puts money back in employees' pockets. Combined with the pre-tax salary packaging structure of a novated lease, the potential savings on an eligible EV are meaningful (run your own numbers through a calculator — the specifics depend on your salary, vehicle price, and usage).
But the EVC report's warning about supply is real. Popular EV models are still constrained. If you're serious about an EV through a novated lease, acting early — and working with a broker who knows the order pipelines — is more important than it used to be with petrol cars. The sales boom means more competition for the same limited stock.
Common questions
Does the EV sales boom mean more EV models are available for novated leasing?
Gradually, yes — but supply constraints remain real. More brands are entering the Australian market, but wait times on popular models can still stretch months. A good novated lease broker will check live availability before you commit.
Is Australia's EV policy gap a reason to wait before getting an EV on a novated lease?
Not necessarily. The FBT exemption for eligible EVs is already live and available to PAYG employees now. Waiting for broader policy improvements could mean missing the current tax benefit — and waiting longer for supply to loosen up.
What counts as an 'eligible' EV for the FBT exemption?
Generally, battery electric vehicles (BEVs) and plug-in hybrid electric vehicles (PHEVs) below the luxury car tax threshold, first held and used after 1 July 2022. Your novated lease provider should confirm eligibility for any specific vehicle before you sign.
Why does Australia lag behind other countries on EV adoption?
The Electric Vehicle Council's report points to a combination of limited charging infrastructure, constrained import supply, and weaker government fleet and purchase incentives compared to markets like Norway or the UK.