EV Sales Up 65% — But Australia Is Still Behind the World
EVs hit 3.39% of Australian car sales — a 65% jump. Here's what the EV Council's latest report means if you're considering a novated lease on an electric car.
Electric vehicle sales in Australia are growing fast. According to the Electric Vehicle Council's latest State of EVs report (Source 1), EVs now represent 3.39% of all new vehicle sales — a 65% increase year-on-year. That sounds impressive until you look at comparable markets: Norway sits above 80%, and even the UK and Germany are well into double digits.
The gap isn't about appetite. Australians are clearly interested. The gap, the Council argues, is policy. Limited model availability, a lack of charging infrastructure commitments, and inconsistent federal support have kept Australia trailing. The good news is that the policy lever most relevant to PAYG employees — the FBT exemption on eligible EVs under a novated lease — is already in place and working.
What this means for novated lease customers
The EV Council's data confirms what we're seeing on the ground: more Australians are actively shopping EVs, and a novated lease is increasingly the most tax-efficient way to do it for PAYG employees.
The federal FBT exemption — introduced for eligible battery electric vehicles, plug-in hybrids, and hydrogen fuel cell vehicles — removes one of the biggest cost barriers from the equation. Combined with the pre-tax nature of novated lease repayments, eligible employees can see meaningful reductions in their overall cost to drive compared to a standard car loan or outright purchase. We won't quote specific dollar figures here because every situation is different — income, employer, vehicle price and usage all matter — but the potential savings are real and worth modelling for your circumstances.
The catch the EV Council flags is supply: popular EV models still carry wait times, and not every make and model qualifies for the FBT exemption. If you're planning ahead, starting the conversation early matters more with EVs than with traditional vehicles.
Common questions
Does Australia's EV growth rate affect whether I can get an EV on a novated lease?
Not directly — the novated lease structure and FBT exemption eligibility depend on the vehicle type and price, not national sales volumes. However, low supply driven by the policy gaps the EV Council identifies can mean longer wait times on certain models.
Which EVs are FBT-exempt under a novated lease?
Eligible vehicles include battery electric vehicles (BEVs), plug-in hybrid electric vehicles (PHEVs), and hydrogen fuel cell vehicles that fall below the luxury car tax threshold. The ATO's current guidance sets out the qualifying conditions — and we check every vehicle against these before structuring a lease.
Is now a good time to go EV on a novated lease given Australia's policy uncertainty?
The FBT exemption is legislated and currently in force, so the tax benefit is real today. Policy can change, but locking in a lease now means you benefit from the exemption for the term of that lease. Speak to us to understand what a change in policy would mean for your specific arrangement.
Why is Australia so far behind other countries on EV uptake?
According to the Electric Vehicle Council's State of EVs report, the primary drivers are policy gaps — inconsistent federal support, limited model supply compared to markets like Norway or the UK, and infrastructure lag. Consumer demand is clearly there; the structural environment hasn't kept pace.
Can I novated lease a PHEV?
Yes — plug-in hybrid electric vehicles are currently included in the FBT exemption, though the government has signalled this may be reviewed. We'll give you the current picture and flag any known upcoming changes before you commit.