Australia’s New Vehicle Efficiency Standard (NVES), came into full effect from 1 July 2025, has been hailed as a landmark moment for transport decarbonisation. But for Fleet Managers tasked with aligning vehicle procurement to organisational sustainability goals, navigating the contradictory commentary from leading automotive lobby groups is creating unnecessary confusion.
While the Federal Chamber of Automotive Industries (FCAI) and the Electric Vehicle Council (EVC) both agree that NVES marks a historic policy shift, their interpretations of its effectiveness and implications for the market are starkly different. And for those managing multimillion-dollar fleet investments, the lack of consensus muddies the waters at a time when clarity is most needed.
FCAI: Supply is There, But Demand is Lagging
In its 30 June media release, the FCAI called out a lack of consumer demand as the primary risk to NVES success, suggesting government inaction is hindering the market.
“From tomorrow, vehicle manufacturers will be held accountable for the emissions profile of the vehicles they supply to the market,” said FCAI Chief Executive Tony Weber. “There are now more than 100 electric vehicle (EV) models and more than 50 plug-in hybrids available to Australian consumers.”
Despite this, the FCAI points to the low market share of EVs—just 7 per cent of new vehicle sales—as proof that demand is falling short. Weber argues that “affordability, infrastructure and consumer confidence” remain barriers, and that the NVES targets are “aggressive” and becoming “vastly more stringent every year until 2029”.
The FCAI warns that skyrocketing electricity prices, lack of public recharging options, and total cost of ownership concerns are creating headwinds for adoption. “What is needed now is a serious, coordinated effort to make the transition viable for all Australians, not just early adopters,” Weber added.
EVC: Standards Are Working and Demand Is Soaring
In contrast, the Electric Vehicle Council paints a far more optimistic picture.
“The NVES is already successfully providing Australian drivers with a rapidly growing range of modern vehicles that reduce emissions, lower fuel costs and deliver community-wide benefits,” said EVC Chief Executive Julie Delvecchio.
According to EVC figures, EVs now represent more than 11 per cent of new vehicle sales in 2025—a new record and 17 per cent up on the same period last year. The council attributes this growth in part to the NVES, claiming it has doubled the number of EV models available to Australian buyers since the standard was first proposed.
“July 1 marks a milestone for Australia as we power ahead with fuel efficiency standards and catch up to the rest of the developed world,” Delvecchio said. “Whether they are plug-in hybrids or full electric, this greater choice is helping keep more money in drivers’ pockets instead of flowing to offshore oil companies.”
The EVC also highlights the increasing availability of EVs across vehicle categories—including utes, vans and family SUVs—as evidence that consumer needs are being met. They reject the FCAI’s downbeat messaging, asserting that affordability has improved, with models now available “just over $30,000 drive away.”
The Fleet Manager’s Dilemma
These opposing narratives place Fleet Managers in a difficult position. On one hand, the FCAI’s emphasis on external constraints could justify conservative fleet replacement strategies that delay the adoption of low- and zero-emission vehicles. On the other, the EVC’s stance encourages a more progressive approach that aligns with many organisations’ carbon reduction commitments.
The truth likely lies somewhere in between.
Fleet Managers must avoid being swayed by politicised industry spin and instead return to the fundamentals: What are the fleet’s sustainability targets? What total cost of ownership modelling has been done? What operational fit do new low-emission vehicles offer?
NVES does not mandate which vehicles fleets must buy—it sets emissions limits across a supplier’s portfolio. But over time, those limits will reshape the vehicles available on the Australian market. Fleet Managers who base their vehicle strategy on long-term organisational goals, rather than short-term market pessimism, will be better positioned as the policy matures.
Strategic Planning Over Spin
For Sustainability Managers and CFOs, this latest clash highlights the importance of internally led planning. While the FCAI and EVC debate the current state of consumer readiness, the real question for organisations is: Are we ready?
- Have you created a baseline for your fleet emissions?
- Have you modelled emissions reduction targets under different vehicle mix scenarios?
- Are procurement policies updated to reflect NVES-aligned vehicle availability?
- Do your drivers and operational teams have the tools and training to reduce fleet emissions?
As one of the most significant transport policies in Australia’s history, NVES will not be without disruption. But mixed messages from the top only add noise. Fleet decision-makers should rely on internal direction—anchored in data, policy and purpose—rather than waiting for the lobby groups to agree.
Bottom Line: NVES is here, and it’s working—albeit unevenly. Don’t let industry infighting dictate your emissions strategy. Let your organisation’s goals do that.
