New-vehicle sales climb

The new-vehicle market strengthened last year after a weak start to finish ahead of 2024 despite softer results in December, says the Motor Industry Association (MIA).

Registrations tracked higher on an annual basis from June with strong activity in the spring, while last month’s “easing reflects typical year-end timing rather than a change in underlying demand”. 

Overall, the year marked a period of stabilisation with activity recovering from earlier lows but remaining below longer-term averages, says Aimee Wiley, the MIA’s chief executive.

“Activity lifted from mid-year and finished ahead of 2024 supported by easing financial conditions and improving confidence, but demand remains measured,” adds Wiley, pictured. “Buyers are prioritising value, practicality and suitability, whether that’s in their choice of vehicle segment or motive power. 

“What the data shows clearly is a market adjusting with households and businesses being deliberate about the timing and scale of their purchasing decisions.” 

Economic conditions improved during 2025’s second half “to provide a more supportive environment for vehicle demand”. GDP returned to growth in the September quarter and business investment showed early signs of recovery including in transport equipment. Interest rates eased during the year with the official cash rate reduced to 2.25 per cent by November. 

Lower borrowing costs are flowing through to households and businesses, although labour market conditions remain soft and consumer spending uneven. Confidence improved towards year-end to support larger purchasing decisions. 

Passenger-vehicle registrations eased in December but finished the year ahead of 2024. Demand improved steadily during the year, moderated by pressure on household budgets and cautious purchase timing. Light-commercial volumes also eased last month but ended the year slightly higher than 2024. 

Business and fleet replacement demand remained supportive as regional and rural activity provided a degree of resilience resulting in this segment holding up better than more discretionary areas of the market. Annual sales of heavy commercials remained weak.

“While December recorded a lift from a low base, full-year volumes were well below recent levels, reflecting continued caution around large capital investment decisions,” says Wiley.

“Motive power trends in 2025 differed across passenger and commercial segments, reflecting variations in use cases, cost considerations and operating requirements”

In the light passenger-vehicle segment, fossil-fuel hybrids increased their share year on year, while plug-in hybrids (PHEVs) also recorded a higher share than in 2024. Battery electric vehicle (BEV) share was “broadly stable”. 

“The growth in hybrids reflects their increasing availability at lower purchase prices, improved fuel efficiency and suitability across a wide range of everyday uses,” explains Wiley. 

“As a result, hybrids are emerging as a practical sweet spot for many by delivering emissions reductions without the higher upfront cost, charging or infrastructure considerations associated with full electrification.”

In light commercials, petrol and diesel models remained dominant by share, although their market share declined on an annual basis. Hybrid and PHEV uptake increased as new products entered the market, supporting gradual adoption when operating requirements align. 

BEVs also increased share from a low base, reflecting a measured transition as product availability expands and businesses assess suitability, cost and infrastructure readiness. 

Wiley says: “The 2025 calendar year didn’t signal a return to previous market highs, but did mark a reset to more stable levels of demand. Activity finished clearly higher than in 2024, supported by easing financial conditions and improving confidence. 

“Overall, the data points to a market recovering gradually, with households and businesses remaining selective about the timing and scale of investment decisions.”

Monthly and annual stats

A total of 9,304 new vehicles were registered last month. This reflected a 9.8 per cent decrease, or by 1,011 units, compared to December 2024, and a seven per cent increase, of 8,998 units, on a year-to-date basis.

There were 6,420 passenger vehicles sold for an 11 per cent decrease of 790 units compared to December 2024 and a year-to-date 12 per cent increase of 10,548.

Last month resulted in 2,403 light commercials being registered – a 10.4 per cent decrease of 279 units compared to the same month in 2024. That also made for a full-year 1.3 per cent increase of 433 year to date.

As for heavy commercials, there were 481 sold last month for a 13.7 per cent increase of 58 units compared to December 2024 and a year-to-date 24.6 per cent decrease of 1,892 units.