Australia Passenger Cars Market Overview, 2030

The Australian passenger car market is a vibrant, highly competitive, and rapidly evolving landscape, reflecting the nation's diverse geography, tech-forward consumer base, and a growing emphasis on environmental consciousness. Local consumer behavior is characterized by a high degree of digital engagement; the car buying journey increasingly starts online, with extensive research on platforms, virtual configurators, and online reviews. While initial research is digital-first, Australian buyers still value in-person interaction, with a strong preference for completing the purchase at a dealership, even for tech-savvy EV buyers. Brand loyalty, while traditionally strong for established players like Toyota, Mazda, and Hyundai, is diminishing, with over half of consumers open to switching brands to secure a better price or value proposition. Most households, particularly outside major capital cities, own two or more vehicles, signifying the importance of private transport for daily commuting, family activities, and recreational pursuits. Younger, affluent buyers often lead the charge in adopting new technologies and premium vehicles, while strong demand exists across all age and income brackets for reliable and practical transport. Distribution models predominantly revolve around franchised dealerships, offering a critical touchpoint for test drives, personalized sales experiences, and financing arrangements. The influence of digital platforms and e-commerce has exploded, with online channels facilitating initial research, vehicle configuration, and even pre-sales activities. Direct-to-consumer models, particularly from new EV entrants like Tesla, are also gaining traction, challenging traditional dealership networks.

According to the research report “Australia Passenger Car Market Overview, 2030,"" published by Bonafide Research, the Australia Passenger Car market is anticipated to grow at more than 7.22% CAGR from 2025 to 2030. Price segmentation is broad, catering from entry-level compact cars to a robust luxury market, dominated by European premium brands. The impact of inflation has translated into rising vehicle prices, while Australia's Luxury Car Tax significantly impacts the cost of premium vehicles, and various state-level taxes and registration fees add to the overall cost of ownership. Import duties, while generally low due to various free trade agreements, still play a role in the competitive landscape. Financing options are extensive, with traditional car loans from banks and financial institutions being the most common. Leasing for both corporate and private use is gaining popularity due to its flexibility and potential tax benefits, and car subscription services are emerging as a niche alternative for those seeking ultimate flexibility without ownership commitments. In-car technologies are a major drawcard. Advanced infotainment systems with large touchscreens, seamless smartphone integration, and intuitive user interfaces are standard. Connectivity features, including real-time traffic, remote vehicle access via apps, and over-the-air updates, are highly sought after. Australia's passenger car market is not merely adopting global automotive trends, it's actively shaping them, particularly in areas of sustainability, advanced safety, and tailored mobility solutions that cater to its unique national characteristics. The role of autonomous driving advancements is a significant area of focus, especially given Australia's long distances and diverse road conditions. While full Level 5 autonomy is a distant prospect for general consumers, the integration of advanced Level 2 and nascent Level 3 autonomous features is increasingly prevalent. The government and automotive industry are actively exploring regulatory frameworks and pilot programs for higher levels of autonomy in controlled environments, recognizing the potential for enhanced safety and efficiency.

SUVs (Sport Utility Vehicles) are the undisputed titans of the Australian automotive market, their dominance growing relentlessly year after year. In May 2025, SUVs alone accounted for over 60% of all new vehicle sales, firmly cementing their position as the default family car and a popular choice for diverse lifestyles. Hatchbacks, while experiencing a significant decline in overall market share due to the SUV surge, continue to maintain a foothold in urban centers. Their compact dimensions, fuel efficiency, and ease of parking make them a practical choice for city commuters, young drivers, and those prioritizing affordability and maneuverability. Hatchbacks are often the entry point into new car ownership for many Australians, particularly in densely populated areas. Sedans, once the quintessential family car in Australia, have faced the most dramatic decline in market relevance. Their once-ubiquitous presence has been largely supplanted by SUVs. Despite this, sedans still hold a niche market, particularly in the premium and luxury segments, where buyers appreciate their refined ride comfort, sleek aesthetics, and often superior handling dynamics. MUVs such as Multi-Utility Vehicles, primarily minivans or people movers, cater to a specific segment of the Australian market which has large families requiring maximum seating capacity and flexible interior space. While not as dominant as SUVs, MUVs offer unparalleled practicality for transporting multiple children, their friends, and associated gear. Coupes, Convertibles, and Sports Cars cater to a small, enthusiast-driven, and often affluent segment. These vehicles are purchased for their performance, design, and emotional appeal, rather than practicality, and are primarily imported luxury or performance brands.

Internal Combustion Engine (ICE) Vehicles, overwhelmingly petrol-powered, still constitute the vast majority of vehicles on Australian roads and a significant portion of new car sales. This dominance is primarily due to the established and widespread refueling infrastructure, the general affordability of ICE vehicles compared to electric alternatives, and a lingering familiarity and trust among a broad consumer base. Diesel vehicles, while facing headwinds due to emission concerns, remain popular in the Light Commercial Vehicle segment and larger SUVs, where their torque and fuel efficiency are highly valued for towing and long-distance driving in rural and regional areas. Manufacturers are continuously refining ICE technology to meet evolving local emission standards and offer greater fuel efficiency, but the long-term trend clearly points towards a diversification of powertrains. The most dynamic shift in the Australian market is the accelerated growth of Electric Vehicles. While starting from a low base, the sale of Battery Electric Vehicles and Plug-in Hybrid Electric Vehicles saw record highs in 2024, with nearly one in ten new cars sold being an EV. Hybrid Electric Vehicles are also experiencing a significant boom in Australia, consistently outselling BEVs for the past seven consecutive quarters. They serve as a practical and appealing interim solution for many consumers, offering improved fuel economy and reduced emissions without the need for external charging, addressing common concerns like range anxiety and infrastructure availability. Japanese manufacturers, particularly Toyota, have a strong presence in the HEV market, offering a wide array of popular models.

Considered in this report
• Historic Year: 2019
• Base year: 2024
• Estimated year: 2025
• Forecast year: 2030

Aspects covered in this report
• Passenger Cars Market with its value and forecast along with its segments
• Various drivers and challenges
• On-going trends and developments
• Top profiled companies
• Strategic recommendation

By Body
• SUV
• Sedan
• Hatchback
• MUV
• others

By Propulsion Type
• ICE
• Electric Show more