The Australian electric vehicle (EV) market is experiencing rapid acceleration, with businesses leading the charge. This growth is fuelled by a combination of factors including government incentives, lower running costs and a growing selection of available models.

Data from the Electric Vehicle Council reveals a significant rise in EV sales. In the first half of 2023, 8.4% of new car sales in Australia were electric, compared to just 3.8% in 2022. This represents an increase of over 120%. This trend reflects the views of Chris Moldrich, General Manager of Asset Finance at Commonwealth Bank Australia, when he identified EV’s as “the fastest growing vehicle type last financial year” and predicts Australia businesses playing a significant role in EV adoption nationwide.

Moving beyond mere trend-following, many businesses are driven by a strong sustainability motivation in EV adoption. The transport sector contributes significantly to national carbon emissions (19%) and EV’s are seen as vital for achieving decarbonisation goals. This sentiment is mirrored by Julie Rynski, NAB executive general manager, who observed a rise in businesses embracing EV’s to “reduce their carbon footprint”.

Supporting this surge is the growth in EV-specific financing options. Data from NAB, Australia’s largest business bank, reveals a staggering 224% year-on-year increase in the value of their EV loan book, signifying a strong demand for financing solutions tailored to electric vehicles.

A report by East & Partners’ Asset Finance Markets paints a surprising picture. It reveals that micro and small businesses are leading the charge in EV adoption, with 16-17% already utilising electric or hybrid vehicles in their fleets. This exceeds the adoption rate of both commercial (13.4%) and corporate firms (9.9%).

The government has also implemented measures to encourage EV adoption. In July 2023, the luxury car tax threshold was adjusted, tightening the definition of a fuel-efficient vehicle. This change, reducing the maximum fuel consumption limit from 7 litres per 100 km to 2.5 litres, incentivises businesses towards more sustainable choices.

In conclusion, the Australian EV market is experiencing a significant boom driven by various factors. With supportive government policies, a growing selection of models and readily available financing solutions, the future of electric vehicles in Australia looks set for exponential growth.