Australia Car Market 2026 | Projected to Reach SD 23.6 Billion by 2034

Market Overview

The Australia car market reached a size of USD 21.5 Billion in 2025 and is projected to expand to USD 23.6 Billion by 2034. The market is set to grow at a CAGR of 1.05% between 2026 and 2034, driven by rising demand for electric vehicles, SUVs, and connected car technologies, along with growing environmental awareness, lifestyle trends, and technological innovation. The demand is fueled by increasing disposable incomes, government incentives, expanding charging infrastructure, and evolving consumer preferences toward sustainability and smart mobility. Both passenger and commercial vehicle segments are experiencing shifts, supported by diverse model availability, advanced safety features, and the country's transition toward ecofriendly transportation, reflecting Australia's position as a mature yet evolving automotive market in the Asia-Pacific region.

Grab a sample PDF of this report: https://www.imarcgroup.com/australia-car-market/requestsample

How AI is Reshaping the Future of Australia Car Market:

• AI-driven predictive maintenance systems analyze vehicle data to identify potential component failures before they occur, reducing downtime and service costs while enhancing reliability in the expanding Australia car market valued at USD 21.5 Billion.

• Machine learning algorithms optimize manufacturing processes by predicting demand patterns, streamlining production schedules, and reducing waste, helping automakers respond more efficiently to market dynamics and consumer preferences.

• AI-powered personalization features deliver customized driving experiences by learning individual driver preferences for climate control, seat positions, entertainment, and navigation routes, enhancing user satisfaction and vehicle appeal.

• Computer vision technology enables advanced driver-assistance systems (ADAS) including adaptive cruise control, lane-keeping assist, and automated parking, improving road safety and accelerating the adoption of semi-autonomous features.

• AI facilitates smart traffic management integration by analyzing real-time traffic data and optimizing route planning, reducing congestion, fuel consumption, and emissions while improving overall driving efficiency.

• AI-assisted customer service chatbots and virtual assistants provide 24/7 support for vehicle inquiries, booking services, and troubleshooting, enhancing customer experience and streamlining dealership operations.

Market Growth Factors

The Australia car industry growth is strongly driven by rising consumer preference for SUVs. Australian households increasingly favor spacious and versatile vehicles suitable for outdoor recreation, long-distance travel, and family use. Automakers have expanded their SUV portfolios, offering models ranging from compact crossovers to premium and luxury SUVs. Modern SUVs now feature improved fuel efficiency, refined handling, and advanced safety technologies, attracting both urban and regional buyers. Growing availability of hybrid and electric SUVs is further strengthening demand by combining efficiency with practicality. Stylish designs, competitive pricing, and strong resale value continue to reinforce SUVs as the dominant vehicle segment.

The rapid adoption of electric vehicles and expansion of charging infrastructure are propelling market growth. In 2025, battery electric vehicle sales exceeded 103,000 units, while plug-in hybrid sales surged to more than 53,000 units, reflecting strong consumer uptake. Government incentives such as fringe benefits tax exemptions, registration discounts, and purchase rebates are improving affordability. Australia had 1,272 fast-charging locations with over 3,436 plugs by mid-2025, helping reduce range anxiety. Premium brands like Tesla and BMW are attracting high-end buyers, while affordable offerings from BYD and MG are broadening market accessibility.

Technological advancements in connected car technologies are accelerating industry development. Features such as real-time navigation, infotainment systems, and vehicle-to-everything communication are increasingly standard in new vehicles. Carmakers are integrating artificial intelligence and IoT to enable predictive maintenance, voice control, and personalized settings. Demand is driven by tech-savvy consumers seeking seamless digital experiences. Fleet operators are adopting connected systems to enhance efficiency and reduce operating costs. The rollout of 5G networks is enabling advanced connected services, while semi-autonomous features such as adaptive cruise control and lane-keeping assist are gaining widespread acceptance.

Browse the full report with TOC and list of figures: https://www.imarcgroup.com/australia-car-market

Market Segmentation

Vehicle Insights:

• Hatchback

• Sedan

• SUV

• Sports Car

• Others

Propulsion Insights:

• Gasoline

• Diesel

• Electric

• FCEV

Sales Channel Insights:

• Peer-to-peer

• Franchised Dealer

• Independent Dealer

End Use Insights:

• Commercial

• Ridesharing and Taxi Services

• Rental Car Services

• Corporate Fleet

• Individual

Regional Insights:

• Australia Capital Territory & New South Wales

• Victoria & Tasmania

• Queensland

• Northern Territory & South Australia

• Western Australia

Key Players

• Tesla

• BYD

• Toyota

• Mitsubishi

• XPeng

• Geely Automotive

• BMW

• Porsche

• MG

• Mazda

Recent Developments & News

• June 2025: BYD announced plans to expand in Australia with new models launching from 2025, including the Atto 2 SUV and Denza B5 SUV. The brand is transitioning to a direct-to-market approach, aiming to introduce a range of vehicles across various segments to enhance its competitive position against brands like Tesla.

• May 2025: Mitsubishi announced its partnership with Foxtron to develop a groundbreaking electric vehicle for the Australian market, competing with China's growing presence in the small SUV segment. This collaboration is part of Mitsubishi's Momentum 2030 plan, with the launch expected in late 2026.

• May 2025: XPeng announced plans to strengthen its presence in Australia by potentially taking over operations from independent distributor TrueEV. The company aims to enhance local marketing, sales, and service efforts while introducing more models like the G9 and G7.

• 2024: Toyota introduced the full-size Tundra Limited pick-up to the Australian market, built in the U.S. and remanufactured to right-hand drive by the Walkinshaw Automotive Group in Victoria, demonstrating continued expansion in the premium vehicle segment.

• 2024: Geely Automotive announced its re-entry to the Australian market in 2025 with the launch of its EX5 electric SUV, competing with Tesla, BYD, and others in the growing EV segment, offering advanced features including autonomous driving and a range of up to 530 km.

Note: If you require any specific information that is not covered currently within the scope of the report, we will provide the same as a part of the customization.

Ask an Analyst for Your Customized Sample Report: https://www.imarcgroup.com/request?type=report&id=32057&flag=C

Contact Us

IMARC Group
134 N 4th St. Brooklyn, NY 11249, USA
Email: sales@imarcgroup.com
Tel No: (D) +91 120 433 0800
United States: +1-201-971-6302

About Us

IMARC Group is a global management consulting firm that helps the world's most ambitious changemakers to create a lasting impact. The company provides a comprehensive suite of market entry and expansion services. IMARC offerings include thorough market assessment, feasibility studies, company incorporation assistance, factory setup support, regulatory approvals and licensing navigation, branding, marketing and sales strategies, competitive landscape and benchmarking analyses, pricing and cost research, and procurement research.

This release was published on openPR.