Australians are increasingly adopting electrified vehicles, with new figures showing hybrid electric vehicles (HEV) are claiming the lion’s share of sales ahead of battery electric vehicles (BEV).

The latest quarterly sales update from the Australian Automobile Association (AAA) EV Index, reveals that consumers are continuing to shift towards electric vehicles and the market share of internal combustion engine (ICE) vehicles is in decline.

The report, which analyses all new light vehicle sales across the country in the three months to 31 March 2024, found that ICE sales fell by 8.03% and ICE market share dropped to 78.18%, falling below 80% for the first time.

Meanwhile, BEV sales continued to grow strongly, reaching 8.70% market share, but still trailing HEVs which recorded record sales volume and market share of 11.95%.

The report found that plug-in hybrid electric vehicles (PHEVs) and hydrogen fuel cell electric vehicles (HFCEVs) still have very low market shares, with ICE, BEV and HEVs accounting for 98.7% of the quarter’s total new light vehicle sales.

The AAA said sales figures over the past 15 months confirmed a clear trend of growth for BEVs and hybrids and a gradually shrinking market share for ICEs, despite significant quarterly fluctuations.

During this time BEV market share grew from 6.77% to 8.70% and total BEV sales increased from 17,396 to 25,468 vehicles.

HEV sales rose from 6.26% to 11.95% and total HEV sales increased from 16,101 to 35,003 vehicles during this period.

ICE vehicle sales have risen year-on-year (up from 222,136 in Q1 2023 to 228,961 in Q1 2024), but over that period the ICE share of a growing market has declined by more than 8% (down from 86.40% to 78.18%).

Over the past five quarters, ICE market share peaked in Q1 2023 (86.40%) and sales volume peaked in Q4 2023 (248,943).

High fuel prices drive car sales trend

RACQ Head of Public Policy Michael Kane said Queensland new car buyers, like their counterparts in other states and territories, were reacting to ongoing higher fuel prices by making vehicle choices that minimise fuel consumption, or avoid it altogether.

“Queenslanders are continuing to embrace EVs, with AAA figures showing we have maintained our status as the second-highest state overall for EV sales.

“At the same time, we are also seeing strong growth in new hybrid electric vehicle sales.

“We expect EV sales to continue to grow strongly throughout the rest of 2024 particularly with the range of new, more affordable EVs that are scheduled to hit the market.”

Figures from peak industry body the Federal Chamber of Automotive Industries (FCAI) released earlier this month showed Australia had its best first quarter ever for new vehicle sales between January and March 2024, with a record 109,647 sales in March and 304,452 sales for the first three months of the year.

Sales of electrified vehicles in March made up 23.5% of the total market, with battery electric vehicles accounting for 9.5% of sales, up from 6.8% in March 2023.

Hybrid and plug-in hybrid sales also increased, recording a 14% share compared with 6% in March 2023.

Australia’s best-selling vehicle in March was the ICE-only Ford Ranger, but the Toyota RAV4 which is predominantly hybrid ranked second, and the Tesla Model Y BEV was third.

The AAA is the nation’s peak motoring body, representing Australia’s state-based motoring clubs, including RACQ, and their 9.3 million members.