Market Research

Market Overview

The Australia used car market is experiencing a period of remarkable expansion, driven by sustained cost-of-living pressures, rapid digital transformation, and growing consumer preference for affordable pre-owned vehicles. According to IMARC Group, the market was valued at USD 85.54 Billion in 2025 and is projected to reach USD 217.42 Billion by 2034, registering a strong compound annual growth rate (CAGR) of 10.37% from 2026 to 2034. The market recorded USD 52.23 Billion in 2020, affirming more than 63% cumulative growth in the historical period.

The Australia used car market is witnessing robust growth across multiple segments, supported by rising new vehicle prices, supply chain disruptions, and the rapid expansion of digital automotive platforms. Gasoline-powered vehicles dominate the fuel-type segmentation at 61.4% share in 2025, supported by broad model availability and established refuelling infrastructure, while diesel vehicles follow at 28.3%, primarily driven by commercial and regional-use preferences. On the vendor front, organised dealers account for 57.2% of transactions, aided by certification programmes, transparent pricing platforms, and structured financing options that build consumer trust. Digital transformation, growing acceptance of electric and hybrid pre-owned vehicles, and expanding organised dealer networks will serve as the key structural drivers through 2034.

Strategically, the Australia used car market is vital to the nation's economy, providing affordable mobility solutions for first-time buyers, young families, and budget-conscious consumers facing higher living expenses. The industry spans the full ecosystem from vehicle acquisition and reconditioning through to financing, warranty provision, and digital transaction services, supporting thousands of dealerships and associated businesses nationwide. By 2034, the market will benefit from a maturing supply of pre-owned hybrid and electric vehicles as Australia's EV penetration accelerates, further diversifying consumer choice and expanding market opportunities.

The Australia used car market is poised for exceptional expansion from USD 85.54 Billion to USD 217.42 Billion by 2034, driven by affordability pressures, digital platform adoption, and the growing acceptance of pre-owned electrified vehicles. With organised dealers gaining market share and online marketplaces democratising access to pricing and vehicle history, the industry offers compelling investment opportunities. The maturing supply of certified pre-owned vehicles and EV second-hand inventory reinforces a positive long-term outlook across all major Australian regions.

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Australia Used Car Market Summary

The Australia used car market encompasses all pre-registered passenger vehicles, light commercial units, SUVs, and specialty automobiles transacted through organised dealers, certified platforms, and private seller channels. Key segments include:

• By Fuel Type: Gasoline leads with a 61.4% share (2025), reflecting broad model diversity and an extensive refuelling network across Australia, from compact city cars to full-size SUVs. Diesel holds a 28.3% share, underpinned by strong demand from rural buyers, tradespersons, and fleet operators.
• By Vendor Type: Organised vendors account for 57.2% of transactions (2025), reflecting growing consumer preference for certified pre-owned programmes with warranty coverage, vehicle history reports, and structured financing. Platforms such as CARS24 and  are catalysts for this formalisation.
• By Vehicle Type: Hatchback, Sedan, Sports Utility Vehicle (SUV), and Multi-Purpose Vehicles (MPVs)
• By Sales Channel: Online and Offline
• By Region: Australia Capital Territory & New South Wales (35.7%, 2025), Victoria & Tasmania (24.6%), Queensland (18.9%), Western Australia (11.0%), and the Northern Territory & Southern Australia (9.8%)

The market ecosystem comprises a dynamic mix of major dealership groups, digital automotive platforms, certified pre-owned programmes, and private sellers. Industry participants compete across multiple dimensions including vehicle quality, pricing transparency, financing options, warranty coverage, and digital customer experiences.

Key Trends Shaping the Australia Used Car Market

Accelerating Adoption of Digital Automotive Platforms

The Australia used car market is undergoing a fundamental digital transformation, with online marketplaces led by , CARS24, and  democratising access to pricing benchmarks, vehicle history, and condition data. FinTech innovations such as AutoSettle, launched in March 2024, have improved settlement security and instant payment processing, further reinforcing digital confidence in online used car transactions. The proliferation of digital platforms has fundamentally reshaped the buying experience, improving transparency and accessibility for consumers across all regions.

Growing Dealer Channel Preference and Certified Pre-Owned Programmes

Consumer confidence in the dealer channel has surged significantly, with dealer-led transactions accounting for 48.6% of all used car sales in 2025, up sharply from 39.1% in 2024. Authorised CPO programmes from manufacturers such as BMW, Toyota, and Hyundai provide multi-point inspections, warranty extensions, and structured financing, reducing the traditional risk perception of used car purchases and broadening the addressable buyer base to include risk-averse segments. This shift reflects growing consumer demand for greater certainty around pricing, vehicle quality, and after-sales support in a more balanced market environment.

Rising Electrified Vehicle Penetration in the Used Market

Electrified vehicles, including hybrids, electric vehicles (EVs), and plug-in hybrid electric vehicles (PHEVs), all lifted their share of the Australia used car market during 2025. Hybrids recorded the strongest growth among electrified options, supported by lower running costs and wider availability across popular vehicle segments. EVs and PHEVs also increased their presence as more near-new and ex-fleet vehicles entered the second-hand market. This trend reflects changing buyer preferences and improved availability across the used market, positioning electrified vehicles as a significant growth opportunity for organised dealers.

SUV Dominance and Evolving Consumer Preferences

SUVs continued to strengthen their dominance of the Australia used car market throughout 2025, while passenger vehicles lost further share. Electrified powertrains gained traction most strongly within SUV segments, aligning with broader consumer demand for versatility, efficiency, and lower running costs. The Toyota HiLux, Ford Ranger, and Mitsubishi Triton consistently rank among Australia's most-traded used diesel vehicles, highlighting the sustained popularity of utility-focused models among Australian buyers.

Market Stabilisation and Structural Health

After several years of disruption, the used car market has moved into a more stable, sustainable phase characterised by disciplined pricing, better stock availability, and data-led decision-making. National used car sales totalled 2.32 million vehicles in 2025, down just 0.37% compared to 2024, highlighting a broadly stable market year on year. With supply chains normalising and transparency improving, dealers and OEMs now have a clearer line of sight to pricing, risk, and inventory planning than at any point in the last five years, providing a constructive foundation for continued market growth.

Market Growth Drivers

The Australia used car market is propelled by several robust demand drivers that collectively support sustained expansion through 2034:

• Affordability and Cost-of-Living Pressures: New vehicle prices in Australia have increased significantly due to supply chain disruptions and currency pressures, making pre-owned vehicles a more attractive alternative. With substantial cost advantages compared to new models, used vehicles are increasingly preferred by first-time buyers, young families, and budget-conscious consumers facing higher living expenses.
• New Car Supply Disruptions: Global semiconductor shortages and logistics disruptions significantly constrained new vehicle supply between 2021 and 2023, tightening availability across key markets. As a result, models like the Land Rover Defender in the two-to-four-year age bracket have retained or even exceeded their original value, highlighting a persistent supply-demand imbalance that continues to support strong demand and pricing in the used car market.
• Certified Pre-Owned Programme Expansion: Authorised CPO programmes from BMW, Toyota, and Hyundai provide multi-point inspections, warranty extensions, and structured financing. These programmes reduce the traditional risk perception of used car purchases, broadening the addressable buyer base to include risk-averse segments such as suburban families and retirees.
• Digital Platform Adoption: Online automotive marketplaces led by , CARS24, and  have democratised access to pricing benchmarks, vehicle history, and condition data. These platforms improve transparency and accessibility, making the used car purchasing experience more efficient and trustworthy for consumers nationwide.
• Government Support and Policy Initiatives: The Australian government's Fringe Benefits Tax (FBT) exemption for EVs, introduced to accelerate the flow of EVs into the second-hand car market, has successfully increased the supply of affordable pre-owned electrified vehicles. Second-hand EV sales leapt by 138% between February and March to 7,557, with popular models now selling for between 40,000.
• EV Pre-Owned Opportunity: Rising plug-in hybrid adoption and strong growth in EV registrations are significantly expanding the future supply of second-hand electrified vehicles for organised dealers. This emerging segment presents a substantial growth opportunity as more near-new and ex-fleet electric vehicles enter the secondary market.

Australia Used Car Market Segmentation

IMARC Group provides a detailed analysis of the key trends across each segment of the Australia used car market. The market has been categorized based on the following parameters:

• By Fuel Type: Gasoline (61.4% share, 2025), Diesel (28.3%), Others
• By Vendor Type: Organised (57.2% share, 2025), Unorganised (42.8%)
• By Vehicle Type: Hatchback, Sedan, Sports Utility Vehicle (SUV), Multi-Purpose Vehicles (MPVs)
• By Sales Channel: Online, Offline
• By Region: Australia Capital Territory & New South Wales (35.7% share, 2025), Victoria & Tasmania (24.6%), Queensland (18.9%), Western Australia (11.0%), Northern Territory & Southern Australia (9.8%)

Government Policies and Regulatory Landscape

The Australian government has implemented several forward-thinking policies that are positively shaping the Australia used car market, with particular emphasis on accelerating the availability of affordable pre-owned electrified vehicles.

The Fringe Benefits Tax (FBT) exemption for electric vehicles, introduced following the 2022 election, has been a transformative policy for the used car market. One of its stated policy goals was to accelerate the flow of EVs into the second-hand car market, as novated leases typically last between two to five years. The underlying logic was that while the FBT exemption would be taken up mostly by people on higher incomes, when they rolled those cars into the second-hand market it would benefit lower-income households—which is now demonstrably happening. Second-hand EV sales leapt by 138% between February and March to 7,557, with Tesla Model 3s and Model Ys—the most popular cars when the FBT exemption first set off a wave of new buyers in 2023 and 2024—now selling for between 40,000.

The Australian government is also assessing the impact of extending the EV tax incentive to 2035 to support the adoption of low-emission vehicles. Extending the tax incentive could increase the adoption of low-emission vehicles and expand the availability of second-hand low-emission cars through the inclusion of plug-in hybrid electric vehicles, according to a study by the Electric Vehicle Council.

Additionally, various states offer targeted incentives to promote sustainable vehicle adoption. For example, Victoria has waived its luxury car tax on electric vehicles, while Queensland has implemented reduced stamp duty for EVs, further supporting the flow of environmentally friendly vehicles into the used market.

The New Vehicle Efficiency Standard (NVES), designed to improve fuel economy and reduce tailpipe emissions of new cars, is expected to generate positive secondary effects for the used car market, increasing demand for pre-owned vehicles as buyers seek affordable alternatives to potentially more expensive new models.

Competitive Landscape

The Australia used car market features a dynamic and increasingly organised competitive landscape, characterised by major dealership groups, digital-first platforms, and certified pre-owned programmes. The motor vehicle dealerships industry generated $68.5 billion in revenue in 2024–25, with an annualised growth rate of 4.8% over the past five years.

• BMW Group
• Carma
• CARS24
• CAR Group Limited
• Only Sales Limited
• Nine Entertainment Company

Additional prominent players in the broader motor vehicle dealerships industry include:

• Eagers Automotive (holding a 13.8% market share in motor vehicle dealerships)
• Peter Warren Automotive Holdings
• Autosports

The industry is consolidating rapidly as major dealers engage in acquisitions to build scale and enter new markets. A notable development is Toyota Tsusho Corporation's acquisition of MCT Automotive Group, an Australian used car purchasing and sales business operating the website Cars4Us, for a reported $120 million. Toyota Tsusho noted that "Australia has a high rate of car ownership and demand in the used car market in particular is expected to continue growing steadily, supported by ongoing population growth."

The digital-first segment is also flourishing, with Carma listing on the ASX in November 2025 after raising 118b industry that's been long overdue for a simpler, more trusted experience for buyers and sellers." Carma has sold more than 6,000 retail cars and is the exclusive preferred used-car retailer of the NRMA.

Porter's Five Forces Analysis – Australia Used Car Market

• Bargaining Power of Suppliers – Moderate: The market relies on diverse suppliers including vehicle manufacturers, fleet operators, and individual sellers. Major dealership groups with significant scale can negotiate favourable terms, while digital platforms have increased sourcing efficiency through online acquisition channels. The increasing availability of off-lease and ex-fleet vehicles provides a steady supply stream for organised dealers.
• Bargaining Power of Buyers – Moderate to High: Australian consumers have extensive choice among a wide range of used vehicles, from traditional dealers to digital platforms like  and CARS24. The rise of online price comparison tools and access to vehicle history reports has strengthened buyer power. However, the essential nature of personal transportation and limited supply of certain high-demand models moderates buyer leverage in specific segments.
• Threat of New Entrants – Moderate: Digital platforms have lowered barriers to entry for online-focused used car retailers, with companies like Carma demonstrating successful market entry. However, building consumer trust, establishing efficient reconditioning operations, and competing with established dealers requires significant investment in technology, inventory management, and brand development. Moderate barriers to entry include financing stock acquisition and property leases.
• Threat of Substitutes – Low: While public transport, ride-sharing, and new vehicles represent potential substitutes, the flexibility and independence of personal car ownership remain highly valued across Australia's vast geographical landscape. The increasing affordability of used cars relative to new vehicles, combined with cost-of-living pressures, makes used cars an increasingly preferred choice for many households.
• Competitive Rivalry – High (Healthy): The market is characterised by intense yet healthy competition among major dealership groups, digital-first platforms, and traditional independent dealers. Competition drives continuous improvement in vehicle quality, pricing transparency, warranty offerings, and digital customer experiences. The shift toward dealer-led transactions (48.6% share in 2025, up from 39.1% in 2024) reflects a maturing competitive environment where consumers increasingly value certified programmes and after-sales support.

Regional Analysis

The Australia used car market exhibits distinct regional dynamics based on population density, economic activity, and digital platform adoption across the country:

• Australia Capital Territory (ACT) and New South Wales (NSW): The largest regional market with a 35.7% share in 2025, driven by Sydney's large population base, high per-capita incomes, and the concentration of organised dealerships and digital platform headquarters in the metropolitan area. Strong digital platform adoption and robust infrastructure support consistent market growth.
• Victoria and Tasmania: Represent the second-largest regional market with a 24.6% share in 2025. Victoria benefits from a strong automotive culture and well-established dealer networks across Melbourne and regional centres. Tasmania, while smaller, has seen increased connectivity and stock availability.
• Queensland: Holds an 18.9% share of the market in 2025, supported by a growing population and vibrant automotive market. Queensland is notable for being home to MCT Automotive Group's headquarters in Brisbane's Eagle Farm, with a warehouse holding approximately 1,000 cars.
• Western Australia: Accounts for 11.0% of the market in 2025, driven by a robust resources sector and high disposable incomes. Perth serves as a key retail hub, with increasing demand for both traditional and electrified vehicles. Western Australia is also the fastest-growing region in the used car market.
• Northern Territory and Southern Australia: Represent 9.8% of the market in 2025. These regions see increasing access to used vehicle stock through improved digital platforms and online purchasing options. Remote locations benefit from delivered vehicle services offered by major online retailers.

Major urban centres including Sydney, Melbourne, and Brisbane dominate the market due to their large populations and higher income levels. The presence of well-established dealership networks and digital platforms in these cities further supports market growth, while e-commerce continues to expand access across all regions, including remote and rural areas.

Key Aspects Required for the Australia Used Car Market

• Demand structure spans multiple segments: The market serves diverse consumer needs across fuel types (gasoline, diesel, electric, hybrid), vendor types (organised dealers, unorganised private sellers), and vehicle categories (hatchback, sedan, SUV, MPV).
• Strong cost-of-living dynamics support sustained growth: New vehicle price increases, combined with inflationary pressures and supply chain disruptions, have structurally redirected consumer demand toward pre-owned alternatives, creating a favourable environment for continued market expansion.
• Digital transformation enhances market accessibility: Online automotive marketplaces, FinTech payment solutions, and digital financing options have democratised access to pricing transparency and vehicle information, expanding the addressable buyer base across all demographic segments.
• Increasing acceptance of electrified pre-owned vehicles: Rising plug-in hybrid adoption and strong growth in EV registrations are significantly expanding the future supply of second-hand electrified vehicles, creating new opportunities for organised dealers and appealing to environmentally conscious buyers.
• Distribution channels: Include organised dealer networks, digital-first platforms, online marketplaces (, CARS24, ), auction houses, and private seller listings.
• Growing certified pre-owned programme adoption: CPO programmes from manufacturers and major dealerships provide warranty coverage, multi-point inspections, and structured financing options, reducing traditional purchasing risks and broadening the buyer base.
• Market stabilisation creates investment confidence: After several years of disruption, the market has entered a more sustainable phase with disciplined pricing, better stock availability, and data-led decision-making, providing a constructive foundation for continued growth through 2034.

Recent Industry Developments

The Australia used car market continues to evolve with strategic moves highlighting its positive growth trajectory and commitment to innovation:

• November 2025: Carma listed on the Australian Securities Exchange (ASX), raising 369 million. Co-founder and CEO Lachlan MacGregor described the debut as a "milestone" that "marks the start of a new chapter accelerating our mission to become Australia's number one destination for all things pre-owned cars."
• February 2026: Toyota Tsusho Corporation announced it would acquire MCT Automotive Group, an Australian used car purchasing and sales business operating the website Cars4Us, for a reported $120 million. Toyota Tsusho noted that "Australia has a high rate of car ownership and demand in the used car market in particular is expected to continue growing steadily, supported by ongoing population growth."
• 2025: The Australian government confirmed it would largely maintain the FBT exemption for electric vehicles, with second-hand EV sales leaping by 138% between February and March to 7,557. The policy successfully accelerated the flow of EVs into the second-hand market, with Tesla Model 3s and Model Ys now selling for between 40,000.
• 2025: Dealer-led transactions increased significantly, accounting for 48.6% of all used car sales, up from 39.1% in 2024, reflecting growing consumer confidence in the dealer channel and improved availability of dealer stock.
• 2025: National used car sales totalled 2.32 million vehicles, down just 0.37% compared to 2024, highlighting a broadly stable market year on year after several years of disruption.
• March 2024: AutoSettle, a FinTech startup focused on automotive settlement security, launched to improve payment processing and transaction security for online used car purchases, further reinforcing digital confidence in the market.
• 2025-2026: Electrified vehicles, including hybrids, EVs, and PHEVs, continued to gain share in the used car market, with hybrids recording the strongest growth among electrified options, supported by lower running costs and wider availability across popular vehicle segments.

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