Despite the removal of a key government incentive, plug-in hybrid electric vehicle (PHEV) sales in Australia surged by 130.9% in 2025, reaching a total of 53,484 units. This growth demonstrates a clear shift in consumer demand, as PHEVs now represent 4.3% of all new vehicle sales.
The End of the FBT Benefit and Continued Growth
On April 1, 2025, Australia eliminated the Fringe Benefits Tax (FBT) exemption for PHEVs. The FBT previously allowed businesses to claim tax deductions on PHEVs provided as company cars, making them more attractive to employers and employees. Despite this change, sales rose dramatically, driven by two key factors:
- More Affordable Options: A wave of new PHEV models, particularly from Chinese brands like BYD, GWM, and others, entered the market at lower price points.
- New Vehicle Segments: The arrival of the first PHEV utes, pioneered by BYD, Ford, and GWM, opened a new segment attracting buyers seeking both electric efficiency and utility.
BYD Dominates the Market
BYD emerged as the leading PHEV brand in Australia, capturing over 50% of the market share. Their success is largely attributed to the popularity of the BYD Shark 6, which outsold its nearest competitor by nearly two to one. The Shark 6’s early arrival (deliveries began in February) gave it an edge, but its dominance in the PHEV ute segment is undeniable.
Other notable BYD performers include the Sealion 6 and the Haval H6. The brand’s overall PHEV sales increased by an impressive 337.7% year over year.
Mitsubishi Faces Setbacks
Mitsubishi, once a frontrunner in the Australian PHEV market, experienced significant declines. The brand was forced to discontinue its Eclipse Cross model due to failing new safety regulations, resulting in a 45.2% sales drop for the PHEV version. The updated Outlander PHEV also saw sales decrease by 32.9%. These setbacks allowed BYD to overtake Mitsubishi as the best-selling PHEV brand in the country.
Expanding Brand Landscape
Beyond BYD, several other brands saw PHEV sales increase in 2025:
- Mazda: Up 16%
- BMW: Up 287.3%
- Lexus: Up 256.4% (boosted by the launch of the RX PHEV and improved supply)
Newcomers such as GWM, Chery, Geely, and Omoda Jaecoo also entered the PHEV market, adding further competition.
The rapid growth of Australia’s PHEV sector despite policy changes highlights a clear consumer preference for electric vehicle technology, driven by affordability, expanding model options, and the appeal of hybrid utility. This trend suggests that even without government incentives, demand for PHEVs will continue to rise as more manufacturers compete in this space.
