Australia Electric Vehicle Market Assessment, By Component [Battery, Electric Motor, Controller, Power Inverter, Others], By Vehicle [Passenger Vehicles, Commercial Vehicles], By Charging Type [Trickle Charge, AC Charge, DC Charge], By Propulsion [Battery

Australia Electric Vehicle Market Assessment, By Component [Battery, Electric Motor, Controller, Power Inverter, Others], By Vehicle [Passenger Vehicles, Commercial Vehicles], By Charging Type [Trickle Charge, AC Charge, DC Charge], By Propulsion [Battery Electric Vehicles, Hybrid Electric Vehicles, Plug-in Hybrid Electric Vehicle, Fuel Cell Electric Vehicle], By Region, Opportunities and Forecast, 2017-2031F

Australia electric vehicle market is projected to witness a CAGR of 25.39% during the forecast period 2024-2031, growing from USD 5.26 billion in 2023 to USD 32.14 billion in 2031. The market has observed significant growth in recent years and is estimated to maintain expansion in the following years due to significant progress and advancement in charging infrastructure, increasing sales of electric vehicles, easy accessibility of luxurious electric vehicles, and a shift in the cost of living. The Australia electric vehicle market demand is predicted to grow owing to an increase in fuel prices, a rise in policy parameters to reduce costs for consumers of electric vehicles, and the development of charging infrastructure. According to the Electric Vehicle Council, in 2023, new EV purchases in Australia more than doubled as compared to 2022, with the total number of electric vehicles on the roads of Australia now surpassing 180,000.

The Australian government is announcing different policies to benefit EV consumers and market players in purchasing and selling electric vehicles. For instance, in 2022, the Australian Government introduced an EV Discount policy to increase electric vehicle adoption by fleets. The main benefit of this discount is an exemption from the Fringe Benefits Tax for EVs bought by companies and/or through salary sacrifice arrangements. In addition, manufacturers in the Australian market are investing in establishing manufacturing facilities and launching advanced electric vehicles to address the growing demand for electric vehicles and meet government regulations.

For instance, in July 2024, Zeekr EU B.V. announced that in Australia they will launch at least one new electric vehicle annually from 2025 to address the rising demand for electric vehicles and product expansion.

Technological Advancement in Electric Vehicle Drives the Australia Electric Vehicle Market Demand

Technological advancement in electric vehicles plays an important role in propelling the Australia electric vehicle market demand as these vehicles are effective in reducing carbon emissions. Technological advancements including faster charging, reduced operating costs, increased battery range, and falling prices are projected to drive the growth of Australia electric vehicle market in the forecast period. Manufacturers in market are significantly integrating advanced driver assistance systems (ADAS) to provide EV drivers for more convenience and comfort on the road coupled with making cars safer. In addition, digital infotainment systems in electric vehicles are enhancing the overall driving experience. Automakers are progressively investing in developing feature-rich and user-friendly infotainment systems for electric vehicles to address consumer expectations. Furthermore, key participants in the market are efficiently launching technologically advanced electric vehicles to expand their product portfolio and footprint.

For instance, in November 2023, BYD Company Ltd. announced the launch of the Seal all-electric sedan at a price range starting from USD 49,888 in the Australian market featuring ADAS autonomous emergency braking, nine airbags, driver fatigue monitoring, lane-keeping assistance, and others.

Rapid Establishment of Battery Manufacturing Facility Propels Australia Electric Vehicle Market Growth

Key companies in Australia electric vehicle market are significantly investing in advancing the features of electric vehicles, surging the production of electric vehicles which further drives the Australia electric vehicle market growth in the forecast period. Companies are efficiently planning to offer cheaper electric vehicles with advanced features and long-lasting batteries, coupled with providing more confidence to individuals to drive an electric vehicle. The Australian government is efficiently implementing favorable policies and offering tax benefits and subsidies on the production and electric vehicles sales, fostering the production of electric vehicle batteries. Thereby, companies are planning to establish more manufacturing facilities for producing batteries to gain tax benefits and addressing the rising demand for electric vehicles in Australia.

For instance, in December 2023, Fortescue Metals Group Limited, one of Australia's largest mining companies announced the opening of a USD 35 million electric vehicle battery factory to address the rising demand for batteries and expanding the product portfolio.

Government Favorable Policies Drives the Australia Market Growth

The Australian government is efficiently implementing policies on the sale and purchase of electric vehicles to encourage the production and adoption of electric vehicles. The government is planning to offer subsidies and tax benefits to buyers and sellers of electric vehicles to sell more fuel-efficient vehicles. It is projected that the Australian government introduce its electric car discount to promote the adoption of electric vehicles and help to introduce a robust second-hand market for EVs. In addition, the Australian government introduced a strategy including the National Electric Vehicle Strategy 2023 that involves collaboration between the territory and state governments and the Australian Government in six major areas including data sharing, national standards, fleet procurement, development of remote and regional EV charging infrastructure, and education and awareness. Furthermore, the government announced investments to enhance the charging infrastructure in Australia.

For instance, in April 2023, the Australian Minister for Climate Change and Energy announced an investment of USD 39.3 million to Australia’s electric vehicle charging network with the installation of 117 fast EV charging locations on national highways in Australia.

Hybrid Electric Vehicle Dominates the Largest Australia Electric Vehicle Market Share

Hybrid electric vehicle registers the largest market share in the Australian market, owing to favorable government policies, an increase in per capita income, a rise in the production of electric vehicles, and growing awareness concerning sustainable environment among consumers. The different features including idle-off, quick acceleration, power assist, and others are driving the demand for hybrid electric vehicles in Australia. In addition, the manufacturers of hybrid electric vehicles are integrating regenerative braking systems to capture energy that is typically lost during braking and reduce the need for fuel. Hybrid electric vehicles are fuel-efficient compared to conventional fuel vehicles resulting in cost savings for drivers over time, propelling the Australia hybrid electric vehicle market growth in the forecast period. Companies in the market are planning to launch new hybrid electric vehicles to address the growing demand and ensure a smoother and more comfortable driving experience.

For instance, in May 2024, GAC Group announced the launch of a range of hybrid and electric vehicles in Australian showrooms to compete with other giant market players and expand its market presence.

Passenger Vehicle is Estimated to Register the Largest Market Share

Passenger vehicle is projected to dominate with the largest share of Australia electric vehicle market, owing to an increase in per capita income, advancement in charging infrastructure, rising awareness concerning environmental sustainability, and a rise in the production of passenger vehicles. Continuous innovations in battery technology, a rise in supportive government incentives and policies, fast-charging capabilities, and advancement in electric vehicle technology are projected to propel passenger vehicles in Australia. Manufacturers in the market are planning to invest in different research and development activities to reduce the prices of electric vehicle batteries and establish manufacturing facilities. In addition, the government is planning to invest in the advancement of charging infrastructure and H2 refueling stations to encourage the usage of battery and hydrogen vehicles in fleets. Companies in the market are introducing new vehicles to address the growing demand for passenger vehicles and expand their presence.

For instance, in March 2023, Volkswagen AG announced the launch of five new electric vehicles in Australia within 2 years to reduce carbon emissions and expand their footprint coupled with consumer base.

Future Market Scenario (2024 – 2031F)

Rising awareness concerning environmental sustainability and integration of advanced features in electric vehicles, driving the Australia electric vehicle market demand.

Growing production and sales of electric vehicles to benefit from government policies, propelling Australia market growth in the forecast period.

Increasing per capita income, government subsidies, incentives on the purchase and sale of electric vehicles, and surging adoption rate of electric vehicles in Australia will lead to market growth.

Advancement in manufacturing practices and discounts on the purchase price of electric vehicles raise demand for electric vehicles.

Key Players Landscape and Outlook

Companies in the Australia vehicle market are investing in different research and development activities to advance the performance of electric vehicles and contribute to zero carbon emissions. Key participants are planning to set up their own EV charging stations, increasing the sale of electric vehicles. Companies are working on enhancing effective features to offer the best price and a wider range of electric vehicles. Additionally, companies in the market are adopting different strategies, including joint ventures, mergers and acquisitions, amalgamation, partnership, collaboration, and others, to expand their product portfolio and footprint.

In February 2024, Toyota Motor Corporation Australia Limited announced the launch of its first electric vehicle in Australia.