Australia’s electric vehicle market closed 2025 at a record high, but a global view paints a more complicated picture, according to this sponsored post.

While EVs and plug-in hybrids together accounted for 13.1 per cent of new car sales in Australia, parts of the world hit numbers that were unthinkable five years ago.

Norway finished the year with 95.9 per cent of new cars sold being fully electric. China crossed 50 per cent share for new energy vehicles. Europe averaged closer to 17 per cent on battery-electric alone.

Where does Australia actually sit in that global pecking order? Why does the gap exist, and what does it mean for buyers in places such as Canberra, where adoption is running well ahead of the national average? The 2025 numbers, drawn from manufacturer-association data in each market, offer a clearer answer than the headlines usually allow.

The 2025 snapshot

Battery-electric vehicle sales in Australia hit 103,269 units in 2025, according to the Federal Chamber of Automotive Industries, accounting for an 8.3 per cent share of new vehicle sales. Plug-in hybrid sales more than doubled year-on-year to 53,484, helping push the combined electrified vehicle share to 13.1 per cent, up from 9.5 per cent in 2024.

The Electric Vehicle Council called it a record year, with 38 per cent annual growth and December marking the strongest single-month EV share on record at 16.7 per cent. More than 150 EV models are now available in the Australian market, up from a handful only a few years ago.

By any measure, that is real progress. Whether it counts as fast progress depends entirely on the country you compare against.

Norway: The country that effectively finished the job

Norway has been the unchallenged global leader in EV uptake for over a decade, and 2025 was the year the project effectively closed.

According to data from the Norwegian Road Information Council (OFV), 172,232 of the 179,549 new passenger cars sold in Norway last year were fully electric. That works out to 95.9 per cent. In December alone, the share was 97.6 per cent. Just 487 petrol cars were sold nationwide over the full 12 months.

The Norwegian formula has been clear and consistent for years: stiff taxes and registration fees on combustion vehicles, plus exemptions and incentives for EVs covering everything from value-added tax to road tolls, ferry fares, and parking. A long-term political commitment to ending new-car sales by 2025 stayed in place across multiple governments. Almost no country has matched that policy discipline.

Norway’s case is also unique. The country has fewer than six million people, a relatively small area, and a grid that runs almost entirely on hydroelectric power, which makes electricity cheap and EV charging carbon-light. Translating the Norwegian model directly to Australia is not realistic. But the contrast in policy commitment is striking, regardless.

China: The volume story

If Norway is the percentage leader, China is the volume juggernaut. The China Association of Automobile Manufacturers reported 16.49 million new energy vehicle sales in 2025, a 28.2 per cent annual rise. NEVs (which include battery electric and plug-in hybrid) accounted for 47.9 per cent of total Chinese vehicle sales for the year, and crossed 50 per cent in some months.

The category mix matters here. Battery-electric vehicles made up most of those sales, but plug-in hybrids and range-extender EVs remain significant. BYD overtook Tesla as the world’s largest battery-electric car maker in 2025, with full-year BEV sales of 2.26 million, compared with Tesla’s 1.64 million globally.

Chinese exports doubled, with 2.62 million NEVs shipped overseas. Australia is one of the markets benefiting from that export push. Names like BYD, MG (owned by SAIC), Geely, GWM, Zeekr, and Leapmotor are now firmly established here, often at price points European brands cannot match.

Europe: Climbing steadily

The European picture is closer to Australia’s than to Norway’s. The European Automobile Manufacturers’ Association reported battery-electric vehicles captured 17.4 per cent of EU new car sales in 2025, up four percentage points on 2024. Including the UK and EFTA countries, the Europe-wide BEV share reached 19.5 per cent.

The UK alone finished 2025 with BEVs at 23.4 per cent of new car sales, according to the Society of Motor Manufacturers and Traders. December 2025 saw EU BEV registrations surge 51 per cent year-on-year as buyers responded to tightening fleet emission targets and expiring incentives in certain markets.

The European story is one of policy push (fleet CO2 targets, Zero Emission Vehicle mandates) combined with rising consumer choice. It is also a story of uneven distribution: Germany sits around the EU average, France slightly below, and southern European markets considerably lower.

The US: A familiar struggle

American EV adoption looks more like Australia’s than Europe’s. The third quarter of 2025 set a US record at 10.5 per cent BEV share, helped along by buyers rushing purchases before federal tax credits expired. After that expiry, sales softened. Total US EV market share for 2025 sat just under 10 per cent, with policy uncertainty under the current administration continuing to weigh on the segment.

What the US and Australia have in common is a transport sector built around long distances, large vehicles (utes and SUVs dominate both markets), and a less aggressive regulatory push than Europe. Both markets are growing, but neither is racing.

Where Australia Actually Sits

Stacking the 2025 numbers next to one another:

1. Norway: 95.9 per cent BEV share
2. China: 47.9 per cent NEV share (combined BEV and PHEV)
3. Europe-wide: 19.5 per cent BEV
4. United Kingdom: 23.4 per cent BEV
5. European Union: 17.4 per cent BEV
6. United States: just under 10 per cent BEV
7. Australia: 8.3 per cent BEV, 13.1 per cent including plug-in hybrids

On battery-electric vehicles alone, Australia trails Europe by roughly ten percentage points and lags Norway by a margin that no policy intervention in the next five years would meaningfully close. On the other hand, Australia is now broadly comparable with the US and well ahead of where it sat in 2022, when EV share was a little over three per cent.

Independent analyst Tim Eden, in a recent piece for The Driven, argued that Australian BEV sales have been growing exponentially since 2010 and that on the current trajectory, the country could reach 80 per cent EV sales by 2030. First-quarter 2026 data is already showing roughly 100 per cent growth on the same period a year earlier.

Why the gap exists

Several factors keep Australia trailing Europe and well behind Norway. The Federal Chamber of Automotive Industries notes the New Vehicle Efficiency Standard, which began in January 2025, has improved the supply of EV models reaching Australia, but has not yet meaningfully shifted demand.

The Fringe Benefits Tax exemption for eligible electric vehicles remains the single largest demand-side driver, with industry estimates suggesting novated leases account for roughly 30 to 40 per cent of all EV transactions.

Other persistent issues include:

1. The charging infrastructure has fallen behind the growth in vehicle numbers. The ratio of EVs to public chargers has slipped from one charger per 32 cars to one per 68, according to Energy Networks Australia.
2. The dominance of the ute and large SUV segment in Australian buying patterns, where electric options are only now arriving in volume.
3. A historically slower introduction of low-cost EV models compared with European markets.
4. Geographic distances and rural charging gaps matter more here than in Europe or coastal China.

Some of those barriers are easing. The MG4 and BYD Dolphin have brought sub-$40,000 EVs to Australian buyers. Battery-electric utes are arriving from Chinese manufacturers with realistic tow ratings. Public fast-charging networks like Evie, Chargefox, and the NRMA’s own network continue to expand.

The Canberra picture

Canberra is running well ahead of the rest of Australia on EV uptake. By late 2024, the ACT had passed 10,000 registered electric vehicles, up from around 400 just five years earlier, according to the ACT branch of the Australian Electric Vehicle Association. Roughly three per cent of all registered vehicles in the territory are now electric, with new EV registrations growing about eight per cent faster than the national average.

The ACT government has set the most ambitious state-level target in the country, aiming for an 80 to 90 per cent EV share in new car sales by 2030. NSW, Queensland, and Victoria sit at the more modest 50 per cent mark. The Canberra advantage is partly demographic (high-income, policy-aware buyers; a significant federal public service workforce) and partly structural (a compact city, well-distributed public charging, ACT government EV incentives that have outlasted those of most states).

Even so, broader market conditions still shape what Canberrans can buy. When Australian EV sales flattened in 2024, the slowdown was visible in the ACT as well, though from a higher base. Recovery into 2025 has followed national patterns.

What it means for owners

For buyers weighing the switch, the practical picture is markedly clearer than it was even two years ago. Battery costs continue to fall (lithium-ion pack prices dropped a further 8 per cent in 2025, according to BloombergNEF). Model choice has multiplied. Public charging is patchy in regional areas but increasingly reliable in metropolitan ones.

Insurance is another area where the early uncertainty has largely been put to bed. Major Australian insurers now treat electric, hybrid, and plug-in hybrid vehicles as part of the same product range as combustion cars. NRMA Insurance, for example, offers the same comprehensive and third-party tiers for standard-spec EVs as it does for petrol or diesel vehicles, including coverage for electrical fire damage and portable charging cords as accessories under comprehensive policies. Home-mounted wall chargers typically fall under home contents or buildings insurance rather than car insurance, which is worth confirming before installation.

Servicing costs also generally favour EVs. Brands such as MG and Tesla recommend service intervals of around two years rather than every six months for petrol vehicles, since electric drivetrains have fewer moving parts. Buyers considering second-hand EVs increasingly have access to battery health certificates, with the NRMA having launched a Battery Health Check service that uses diagnostic tools to assess used EV batteries before purchase.

Looking ahead

The Electric Vehicle Council has called for Australian EV sales to reach at least 240,000 vehicles in 2026 to stay on track with the federal government’s 2035 emissions target. Whether that figure is hit depends on policy stability (particularly around the FBT exemption now under review), continued model availability, and a charging network capable of keeping pace with vehicle numbers.

What 2025 made clear is that the global EV transition is no longer a hypothesis. It is in motion, at different speeds in different places. Norway has effectively finished its journey. China is reshaping global manufacturing as it completes its own. Europe is climbing steadily. The US is uneven.

Australia is somewhere in the middle of the pack: growing fast, still well behind the leaders, and visibly accelerating into 2026. For drivers in Canberra, the question is no longer whether EVs will dominate the new-car market, but how soon the rest of the country will catch up to what the ACT has already started.