As the April 2025 deadline for the federal government's fringe benefits tax (FBT) exemption on plug-in hybrid vehicles (PHEVs) approaches, industry experts are urging for an extension of the scheme. This call comes amid growing PHEV sales and the introduction of new models to the Australian market.
Current FBT Exemption:
- Applies to PHEVs and EVs priced under $91,387
- Available for vehicles purchased through novated leases
- Set to expire in April 2025
Market Impact: PHEV sales increased by 120.5% (15,546 units) from January to September 2024. PHEVs accounted for 2.5% of overall new vehicle sales last month
Industry Perspective: National Automotive Leasing and Salary Packaging Association (NALSPA) advocates for extension. NALSPA CEO Rohan Martin: "PHEVs are the stepping stone to pure electric driving"
Arguments for Extension:
- PHEVs offer a practical solution for longer-distance drivers
- Align with Australia's preferred vehicle types (larger dual-cabs and utes)
- Enable earlier electrification journey for Australian motorists
- Growing model availability (e.g., upcoming Ford Ranger PHEV and BYD Shark 6)
Consumer Trends:
- Increasing uptake among everyday working Australians in outer suburbs and regional areas
- PHEVs meeting driving needs and preferences of more working Australians
Market Dynamics:
- BYD Sealion 6 has significantly boosted PHEV sales since its June launch.
- Expected further increase with the introduction of PHEV utes
Broader Context: PHEVs remain the second slowest-selling powertrain type in Australia. Traditional hybrids continue to gain market share, led by Toyota
The call for extending the FBT exemption for PHEVs beyond April 2025 reflects the growing importance of these vehicles in Australia's transition to lower-emission transportation. As new PHEV models enter the market and consumer interest grows, industry leaders argue that continued government support is crucial for meeting emissions targets and making environmentally friendly vehicles more accessible to Australian consumers.
