Norway Is Selling Almost Zero Petrol Cars. Australia Is Watching.
Norway hit 97.8% EV market share in May 2026. Here's what that trajectory means for Australian EV buyers and novated leasing right now.
In May 2026, 97.8% of new passenger cars sold in Norway were electric — and for the first five months of the year combined, the EV share sat at 98%. That's not a rounding error. That's the end of the petrol car in one of the world's most closely watched auto markets, according to The Driven.
Norway didn't get there by accident. It got there because the government made EVs the obvious financial choice for over a decade — tax exemptions, toll discounts, cheaper parking — until the market tipped. Australia is earlier on that same curve, but the curve is real.
What this means for novated lease customers
The Norway data matters to Australian PAYG employees for one practical reason: it tells you where vehicle residual values are heading. When a market moves that decisively toward EVs, the resale floor for petrol vehicles drops. Conversely, quality used EVs hold value better as mainstream demand catches up to supply.
For anyone considering a novated lease right now, the Norway trajectory is a signal — not a panic button. Australia's FBT exemption for eligible EVs and plug-in hybrids already makes the lease structure more attractive on EVs than on comparable petrol vehicles. Add a residual value outlook that increasingly favours electric, and the case for going EV under a novated lease gets harder to ignore.
The caveat worth saying plainly: Norway's policy settings are not Australia's. Our FBT exemption has a price cap, a legislative review scheduled, and eligibility rules that change. Any decision you make should be based on current Australian rules, not Norway's headline number. That said, the direction of travel globally is not ambiguous.
Common questions
Does Norway's EV success mean Australia will follow quickly?
Not automatically. Norway has had aggressive EV incentives for over a decade. Australia's policy settings are different and still evolving. The trend is the same direction, but the timeline is slower and less certain.
Which EVs qualify for the Australian FBT exemption right now?
Eligible zero or low-emissions vehicles (including battery EVs and plug-in hybrids) below the luxury car tax threshold may qualify. The rules have specific conditions — check the ATO's current guidance or speak to a licensed adviser before assuming a vehicle qualifies.
Does residual value matter in a novated lease?
Yes. The residual value set at the start of your lease affects your repayments and what you owe at the end of the term. A vehicle with stronger resale demand gives you more flexibility at lease end.
Is Tesla still the dominant EV brand in Norway?
According to The Driven's reporting on May 2026 data, Tesla led the Norwegian market ahead of Toyota and VW. Tesla is also consistently one of the most popular choices under Australian novated leases.
Should I rush into an EV novated lease because of global trends?
No. Global trends give you context, not a deadline. Your decision should come down to your salary, the specific vehicle, your employer's novated lease arrangements, and current Australian tax rules — not Norway's sales figures.