New research from NRMA Insurance shows that boosting familiarity with electric vehicles (EVs) could be the game-changer needed to speed up their adoption. The study shows that as Australians become more informed about EVs, their likelihood of considering them for their next car purchase skyrockets, paving the way for a more rapid shift towards EVs.

The report, Changing Gears: The Road Ahead for EV Adoption in Australia, is the first instalment of a two-part report produced by market research company Ipsos on behalf of NRMA Insurance. It shows that only 20% of Australians planning to buy a vehicle in the next five years are considering an EV, but that number jumps to 32% among those who are already familiar with them. It also highlights a growing interest in EVs. At present, only 26% of Australians feel knowledgeable about EVs, but nearly half (47%) are eager to learn more.

For Australians not considering an electric vehicle for their next car, among their primary concerns are driving range (54%) and charging times (53%). Despite most Australians driving less than 50 km a day —well within many EVs' range—there is still significant unease about long-distance travel and charging infrastructure. Additionally, 44% of non-considerers cite worries about battery fires, even though research shows road registered EVs do not present a greater risk of fire than internal combustion vehicles.  

Busting the EV myths

NRMA Insurance CEO Julie Batch says the report highlights the work needed to bust the myths about range anxiety, safety, and cost. She also recommends increased support for the second-hand EV market and the introduction of standardised battery testing as key steps to help boost consumer confidence around EVs.

“The good news is that more affordable models are now becoming available. This expansion will boost the used car market and make EVs more accessible to a broader audience. The research shows that 58% of Australians interested in EVs are open to buying a used car, so this will be a practical option for many drivers,” said Ms Batch. 

The report indicates that while current EV owners are confident in their cars’ sustainability and cost savings, many Australians remain sceptical. Only 30% view EVs as the most cost-effective option, and just 42% see them as the most environmentally friendly choice.

High cost is another barrier, with only three models under $40,000 and a limited second-hand market making EVs less accessible for budget-conscious buyers. Despite the higher initial purchase price, many consumers are unaware that lower running and maintenance costs make EVs more cost-effective over their lifetime. An average car driving 13,700 km per year could save $1,000 annually in fuel, or $1,200 with overnight off-peak charging. As battery technology improves and production scales, upfront costs are expected to decrease, making EVs more competitive.

The EV road ahead

Commenting on the report, NSW Minister for Roads John Graham says: “We need a laser-like focus on the specific barriers to EV take-up, to properly understand what’s slowing us down.

The report also illustrates the rapid growth of EVs in Australia and predicts that future expansion will likely be driven by younger drivers. EVs, which made up less than 1% of new car sales in 2020, have consistently doubled their market share annually, reaching 8.5% of light vehicle sales in 2023 and holding steady at 8.4% in 2024.

Unsurprisingly, the surge in EV adoption is most pronounced among drivers with household incomes over $200,000, families with children, and residents of capital cities with many citing lower running costs and sustainability as the key reason for their purchase.

Commenting on the growth figures, Ms. Batch said: “To capitalise on this momentum, we need policies and incentives to support the second-hand EV market, which will help make these vehicles more accessible, especially among some buyers who may be deterred by the upfront cost. Additionally, standardising battery health testing, similar to an odometer test, will be a positive step to building consumer confidence in the longevity and safety of these cars.”

You can access a copy of the report and its recommendations on the NRMA Insurance website: ev-report-changing-gears.pdf (nrma.com.au)