Australia’s used car market continues to show resilience in 2025, with electric vehicle (EV) sales setting new records and auction house Pickles introducing a transparency measure expected to reshape buyer confidence.
One of the most significant developments has been Pickles’ decision to publish battery health scores for all tested EVs sold through its platform. The new system, launching in Sydney and Melbourne in mid-July, provides buyers with both manufacturer and independent State of Health (SoH) reports, alongside a detailed certificate. With average tested batteries returning an SoH of 96 per cent, the move is expected to boost confidence among both trade and private buyers, helping to drive further uptake of used EVs.
Salvage EVs also posted sharp growth, with sales up 15 per cent on the previous quarter and more than 200 per cent above FY2024 levels. Queensland has emerged as a hub for interstate salvage demand, reflecting the state government’s $570 million Battery Industry Strategy aimed at building capability across the energy storage supply chain. Most salvaged EVs are being purchased for second-life applications, parts recycling, or export.
Meanwhile, discussions around reforming the Luxury Car Tax (LCT) remain active, particularly among industry groups who argue it hampers EV adoption. The tax continues to apply at 33 per cent on the portion of a vehicle’s value above the threshold, which for FY2025-26 is $91,387 for fuel-efficient vehicles and $80,567 for all others. However, from July this year the definition of ‘fuel-efficient’ tightened to 3.5 litres per 100 km or less, meaning many hybrids and plug-in hybrids no longer qualify. Calls for a phased reduction or removal continue, but no legislative changes have been made.
Private buyers are also playing a bigger role in the used vehicle market. Pickles’ latest survey found value for money, vehicle range, and brand trust are the top motivators drawing individuals to public auctions. Nearly a third of respondents first discovered the auction house online, highlighting the importance of digital channels in buyer engagement.
Looking ahead, moderate softening in used vehicle prices is forecast for the third quarter, as OEM discounting and higher new vehicle availability exert pressure. However, ongoing cost-of-living challenges are expected to sustain buyer demand in the used market, particularly for late-model and well-maintained vehicles.