Australia’s new vehicles are getting cleaner, but when placed against global benchmarks, the country still has significant ground to make up.
The latest analysis from the National Transport Commission shows that while emissions intensity from new light vehicles has fallen sharply in recent years, Australia continues to trail many international markets — particularly Europe — on both vehicle efficiency and electrification.
Progress at home, but slower than overseas
The NTC’s long-term tracking of vehicle emissions intensity highlights encouraging momentum. Vehicles first registered in 2023 and 2024 delivered some of the strongest year-on-year emissions reductions in more than two decades, driven by increased uptake of electric and hybrid vehicles and improvements in conventional powertrains.
However, when compared internationally, Australia’s starting point remains higher. Average new passenger vehicles sold locally emit around 35 per cent more CO₂ than equivalent vehicles sold in Europe. This gap reflects a mix of vehicle choice, slower historic uptake of electrified powertrains, and a market that has long favoured larger, heavier vehicles.
EV uptake is rising — but still behind global leaders
Electric vehicle adoption in Australia is accelerating. Battery electric vehicles accounted for around 13 per cent of new registrations in 2024, a sharp increase compared with just a few years ago. That puts Australia ahead of some comparable markets, including Japan and the United States.
But leading EV markets continue to pull away. In Europe, electric vehicles account for more than 20 per cent of new passenger vehicle sales, while China is approaching half of all new sales being electric. As a result, Australia’s overall fleet emissions remain higher, even as local sales trends improve.
Fleet longevity slows national progress
One of the structural challenges highlighted by the NTC is how long vehicles remain on Australian roads. On average, light vehicles stay in service for close to 20 years, meaning older, higher-emitting vehicles continue to influence national emissions outcomes long after cleaner alternatives are available.
This long lifespan slows the pace at which improvements in new-vehicle emissions translate into lower emissions across the total fleet. Even strong gains at the point of sale take years — sometimes decades — to fully materialise.
Bigger vehicles, bigger emissions challenge
Vehicle size also plays a role. Australia’s preference for utes and SUVs continues to shape emissions outcomes. While technology improvements have reduced emissions intensity across these segments, increases in vehicle mass and footprint offset some of those gains.
In contrast, markets with stronger emissions performance typically combine higher EV uptake with smaller average vehicle sizes and stricter efficiency standards.
Why this matters for fleets and policy
For fleet operators, the data reinforces the importance of both what vehicles are purchased and how often they are replaced. Fleets that renew vehicles more frequently help accelerate the entry of cleaner vehicles into the market and remove the highest-emitting vehicles sooner.
From a policy perspective, the international comparison highlights that emissions reductions are most effective when demand-side incentives, supply availability and efficiency standards move together. Countries leading on emissions have generally sustained support until electrification reaches critical mass.
Catching up requires consistency
The NTC report makes it clear that Australia is heading in the right direction — but not yet at the pace of global leaders. Closing the gap will require sustained momentum in EV uptake, faster fleet turnover and continued access to lower-emission vehicle options across all segments.
As the data shows, the challenge is not a lack of progress, but the scale and speed required to match international benchmarks. For fleets and policymakers alike, the task ahead is to turn recent gains into long-term structural change.
