Electric vehicle sales in Australia reach record in May

Electric vehicle sales in Australia reached a new monthly record in May, with one in five new vehicles sold being an electric vehicle. Nearly half of all new vehicles sold last month were either an electric vehicle, hybrid, or plug-in hybrid. Sales of petrol and diesel SUVs fell 31 percent and 41 percent respectively, while plug-in hybrid SUV sales rose 377 percent.

Chamber of Automotive Industries said consumer preferences are changing rapidly in the SUV segment. The same executive added that charging infrastructure must become more of a priority as the number of electric vehicles on the road grows. Rising sales of electric vehicles have been driven in part by an influx of cheaper cars from Chinese companies.

Almost 5,000 vehicles from one such company arrived in Melbourne this week, the first shipment of almost 30,000 vehicles the company will send to Australia in the coming months. A chief operating officer of the company said most cars in the first shipment were sold after the war in Iran started.

The same officer noted a significant surge in demand for electric vehicles in March when the war broke out in the Middle East.

Security and policy concerns The company has sold 120,000 vehicles, both electric and petrol-powered, since launching in Australia in 2022 and now has more than 100 dealerships. Like other Chinese companies, the company has faced suspicion from consumers and politicians due to cybersecurity concerns related to technology in its vehicles.

A professor from the Australia-China Relations Institute said there were genuine cybersecurity and data-governance issues related to smart vehicles but noted these are not unique to Chinese brands. The professor added that the real policy question is how Australia regulates data storage, software access, telematics, procurement standards and auditability across all connected vehicles.

Australia's spy agency warned politicians last month not to have sensitive conversations in any type of vehicle.

Fuel prices and long-term outlook The closure of the Strait of Hormuz and subsequent spike in oil prices helped push consumers toward electric vehicles in recent months. Fuel prices have since dropped significantly due to cuts to Australia's fuel tax, the release of strategic reserves and a pivot away from Middle Eastern supplies.

A chief executive of the Electric Vehicle Council said the company's delivery of electric vehicles demonstrated how much things are changing in Australia and called for continued investment in charging infrastructure. The same executive said this will require significant focus from the federal government and at a state level.

Toyota remains Australia's top-selling car brand, selling at least twice as many vehicles as every other brand and topping sales every year for more than two decades. A Toyota spokesperson said the company has long championed a multi-pathway approach to decarbonisation and believes battery electric vehicles are only one part of a broader mix of solutions.

Toyota said it has seen increasing demand for electric vehicles and hybrids in 2026, while half of all sales in 2025 were hybrids. Several car companies including Toyota have scaled back electric vehicle production in recent years amid sluggish demand in key markets including the United States.