PHEV Sales Surge with FBT Exemption Deadline Looming

New figures show plug-in hybrid vehicle (PHEV) sales continue to rise rapidly in Australia just as a major discount for the car type nears its end. Data released today by the Federal Chamber of Automotive Industries reveals that 4,871 PHEVs were sold in February – a monthly record for the Australian market. This represents a 346.1% increase compared to February 2024, contributing to a 222.2% overall rise in PHEV sales for 2025. It comes as the FBT exemption for PHEVs is due to end on April 1, 2025. National Automotive Leasing and Salary Packaging Association (NALSPA) chief executive Rohan Martin said the large uptake in PHEVs demonstrates their widespread appeal and highlights their crucial role as a stepping stone toward fully electric vehicles. "The uptake of plug-in hybrid vehicles is currently exponential," Mr Martin said. "This reveals two key insights: firstly, Australians who prefer SUVs and larger vehicles are eagerly embracing lower-emission alternatives, which are predominantly available today as PHEVs. Secondly, when you get the policy levers right as we've seen through the FBT exemption and other measures, it influences behaviours and drives buyer demand. "Australians love their larger vehicles but they are currently harder to fully electrify. PHEVs are gradually providing Australians with a range of larger lower emissions vehicle types, including the new and very popular BYD Shark PHEV ute which contributed more than 2,000 PHEV units to the February result. "During a cost-of-living crisis, PHEVs with the support of the FBT exemption are enabling Australian motorists to save on the upfront cost of a lower-emissions car, while also significantly saving money on running costs. Research that we commissioned late last year shows PHEV drivers predominately use their cars like a pure EV, with most plugging in at least twice a week and using electric power only for two-thirds of their trip. "The FBT exemption together with greater PHEV model availability from manufacturers, have played a major role in stimulating PHEV demand. Although demand patterns for PHEVs may shift once the exemption ends on 1 April 2025, we anticipate good uptake of both PHEVs and conventional hybrids to continue through novated leasing arrangements as motorists look for much needed cost-of-living savings. "This outlook is also bolstered by forthcoming low-emission model releases and motorists' focus on reducing their emissions. Importantly, the New Vehicle Efficiency Standard whilst supporting the supply of more fuel-efficient petrol and diesel vehicles into Australia, is also aimed at expanding the range of available low-emission options, with manufacturers projected to respond by bringing more of these vehicle types to Australia to meet growing demand. "Motorists hoping to benefit from the PHEV FBT exemption may still find select models available for immediate delivery, but they'll need to act lightning fast to ensure vehicle delivery before 1 April 2025 to qualify."