EVs Hit 20% of New Car Sales in Australia — Here's Why That Matters
Australia's EV market just hit a record 20% share. If you're considering a novated lease, here's what the shift means for your options and FBT exemption eligibility.
Australia's electric vehicle market has crossed a significant milestone. According to The Driven (Source 1), EVs accounted for 20% of new car sales in the country's biggest month on record — with Tesla leading the charge.
That's not a niche number anymore. One in five new cars sold in Australia last month was electric. For anyone sitting on the fence about a novated lease, that kind of market momentum translates directly into more choice, more competitive pricing, and a broader pool of eligible vehicles under the existing FBT exemption framework.
What this means for novated lease customers
The growth in EV market share has a few practical knock-on effects if you're looking at novated leasing right now.
More eligible vehicles, more competition on price. As EV volumes rise, dealer and fleet pricing tends to become more competitive. That matters because the pre-tax cost of the vehicle is what your novated lease repayments are based on — and lower drive-away prices mean lower repayments.
The FBT exemption is still in play — but policy can move. Eligible battery electric vehicles under the luxury car tax threshold currently attract a fringe benefits tax exemption, which is a core part of why novated leasing an EV stacks up so well for PAYG employees. With EV adoption accelerating, that policy will face ongoing scrutiny. If you've been waiting to see whether EVs are a viable mainstream choice in Australia, the 20% market share figure answers that question pretty clearly.
Tesla remains the dominant novated lease pick. Tesla models consistently sit at the top of novated lease enquiries, and this data reinforces why — they're moving units at scale, which supports resale values and gives fleet financiers confidence. But increased competition from other brands entering the market (including newer entrants like Cadillac's electric SUV range, covered in the same report) means Tesla's dominance is worth watching.
Common questions
Does the FBT exemption apply to all EVs on sale in Australia?
No. To qualify, the vehicle must be a battery electric vehicle (BEV) or certain plug-in hybrids, and the vehicle's value must fall below the luxury car tax threshold at the time of first retail sale. Check the ATO's current guidance and confirm with your novated lease provider before committing.
Does higher EV market share affect my novated lease deal?
Indirectly, yes. Greater sales volumes tend to push residual values and competitive pricing in ways that can benefit lease customers. It also signals to policymakers and lenders that EV fleet risk is lower, which can influence finance terms over time.
Is Tesla still the best EV to novated lease in Australia?
Tesla models are popular for good reasons — strong residual values, widespread charging infrastructure, and consistent FBT exemption eligibility. That said, 'best' depends on your driving needs, salary, and how long you plan to hold the vehicle. A broker can model the numbers across multiple makes.
Should I wait to see if EV prices fall further before getting a novated lease?
That's a personal call, but there's a real cost to waiting — every pay cycle without the tax benefit is a pay cycle where you're paying more tax than you might need to. Rising market competition could put downward pressure on prices, but the FBT exemption's future isn't guaranteed either.