Australian new-car sales to decline in 2025 after record 2024 – Toyota
01/06/2025 05:06 PM
A two-year record run for new-vehicle sales in Australia won’t become a hat-trick, according to the country’s top-selling car brand, amid a drop in demand from the heights of the pandemic.
Sales of new motor vehicles in Australia are tipped to decline in 2025 after four years of consecutive growth – and two annual records – amid a drop in demand, according to market leader Toyota.
Although deliveries are predicted to fall from 2024’s record of 1,237,287 vehicles, Toyota’s prediction would still see 2025 slot in as the fourth or fifth-best year for new-vehicle sales on record.
Demand for new cars has cooled from its peak in the wake of the COVID-19 pandemic, amid rising interest rates, inflation and cost-of-living pressures that have seen many Australians tighten their purse-strings.
But the automotive market has continued to set records as car companies cleared backorders placed multiple years ago – including two-year queues on popular models such as the Toyota RAV4 Hybrid – amid production constraints through 2022 and 2023.
MORE: Australian new-car sales in 2024: Annual record barely broken despite drop in demand
The drop in demand is set to catch up with annual new-vehicle sales results – which are based on how many cars are delivered, rather than orders taken in the showroom – in 2025.
“We think the overall market will ease marginally from the record set in 2024, mainly because of a better balance between supply and demand,” Toyota Australia sales and marketing boss Sean Hanley told local media.
“We therefore see a return to a more ‘normal’ market environment. We’re predicting the market this year will be around 1.170 million to 1.180 million, which is still an incredibly healthy market environment for this country.
“For Toyota, we’re expecting another year with sales again above 220,000. I can assure you our order intake remains very strong, so we are optimistic for the future.”
The Japanese car giant reported record sales in 2024 – with 241,296 deliveries, beating its previous best of 238,938 vehicles in 2008 – and accounted for one in five new vehicles sold.
Annual sales of 1.17 to 1.18 million would place 2025 in the Top Five strongest years for new-vehicle deliveries in Australia, behind 2024’s 1.237 million, 2023’s 1.218 million, 2017’s 1.189 million and 2016’s 1.178 million.
MORE: Toyota sets annual sales record in Australia – VFACTS 2024
But the predicted slip in sales will coincide with the arrival of an unprecedented number of new-car brands to the market in 2025, most from China and many focused on electric vehicles.
Australia is already one of the most crowded new-car markets in the world, but the likes of Geely, Jaecoo, GAC and Aion due in 2025 – in addition to late 2024 launches Zeekr, Xpeng, Leapmotor and more – are set to bring the total beyond 65 brands.
Hanley acknowledged the rapid growth of Chinese-made cars, which accounted for less than 2 per cent of new-vehicle sales five years ago, but today represent 15 per cent of the total.
China is now Australia’s third-biggest source of new vehicles, ahead of South Korea, Germany and the US, and behind only Japan and Thailand.
“By all reports, there could be a dozen new Chinese car companies arriving in Australia by the end of next year,” said the executive.
“In the past five years, they have taken more than 13 percentage points of market share from established brands.
“Despite that huge change in the market dynamics, I should point out that our [Toyota’s] market share today is the same as it was five years ago, in fact, a little higher and you will note how sales have in fact growth.
“You can be sure that we take all competitors seriously and we respect them greatly, but we never, ever take anything for granted.”
The top Toyota executive has previously warned Australians to “do their own research” on new brands, and their commitment to the market in the long term – including keeping existing cars on the road.
“In the end, you’ve got to be able to provide a service. You’ve got to be able to provide confidence,” Hanley told media.
“Toyota has over 260 dealers sitting around the country that are well capable, well invested, that can service and supply parts. And if someone does get into difficulty – our cars aren’t perfect, it can happen – if someone does get into difficulty, there’s a Toyota dealer beside them.
“The only question consumers have got to ask about all these other brands in the future, who’s there for them if they get into trouble?”
The post Australian new-car sales to decline in 2025 after record 2024 – Toyota appeared first on Drive.
