Banning combustion engine cars by 2035 will be necessary to get Australia moving on electric vehicles

Australia’s sluggish electric vehicle transition has begun to accelerate. In the first half of the year, more than 72,000 battery electric and plug-in hybrid vehicles were sold. That’s about 12% of all new cars, up almost a quarter over the same period in 2024.

Despite this momentum, progress is still too slow. EVs now dominate in countries such as Norway (98.3% of new cars), Nepal (76%) and China (51%). Australia is lagging.

If nothing is done, transport is projected to be Australia’s largest emissions source by 2030. Cutting emissions 62–70% by 2035 under the government’s new target will require rapidly shifting from combustion engine vehicles to EVs.

This week, the Electric Vehicle Council called for an end to the sale of new petrol and diesel cars by 2035 to speed up the shift. Setting a sunset date would align Australia with major trading partners.

Despite the risk of pushback, a phase-out deserves serious public debate. Letting the market decide is leading to a very slow transition. This policy leap could trigger the rapid shift we need.

Why is a phase-out needed?

At present, transport accounts for 22% of Australia’s total emissions. It’s also the fastest-growing source.

EVs will be essential in cutting these emissions. Australia has to reach an EV market share for new cars of at least 50% in the next decade to achieve its broader 2035 emissions target.

Without tougher measures and a firm phase-out, that looks unlikely. The task is sizeable. Despite growing momentum, EVs only make up about 2% of the 21.7 million cars on the road today.

Several countries have already committed to banning or phasing out new petrol, gas or diesel cars.

The United Kingdom has mandated 80% of new cars and 70% of vans be zero-emission by 2030 and 100% by 2035.

Europe’s experience shows safeguards are essential

The tussle over the European Union’s legislated ban is worth examining.

All cars and vans sold after 2035 in the EU are legally required to produce zero emissions – other than an exemption for vehicles running under strict conditions on synthetic e-fuels made from captured carbon dioxide and hydrogen.

It wasn’t easy to get these laws through. The bloc’s top carmaking nation, Germany, threatened to block the laws unless e-fuels were allowed. The EU was forced to negotiate a compromise opening a loophole for combustion engines to persist under the guise of “climate-neutral fuel”.

Even so, the EU’s hard-fought ban remains one of the world’s strongest measures to phase out fossil-fuel vehicles. Most major carmakers support the ban and automakers such as Volkswagen have already announced plans to end new petrol and diesel car sales well before 2035. Mercedes has been the most vocal in opposing the ban.

The mistake Brussels policymakers made was to move to ban fossil fuel cars without laying out clear transition pathways. When bans like this are proposed, powerful interests invested in the status quo will look for ways to weaken them.

Ensuring these phase-outs work depends on preventing backsliding through safeguards such as clear interim targets to track progress, flexible review mechanisms, protections against loopholes, and support for equity and infrastructure.

Politics and industry pressure will complicate Australia’s path

Any move to ban or restrict a product will meet resistance. When the federal government rolled out its New Vehicle Efficiency Standard, it met strong pushback – even though the standards have no binding sales targets or bans but rather set targets for exhaust emissions from new vehicles.

Federal minister Chris Bowen has repeatedly emphasised that the transition must rely on levers such as efficiency standards, incentives and infrastructure rather than bans.

Bowen has stated Australia “cannot just wish away fossil fuels” and dismissed earlier proposals to ban new combustion engine vehicles. His consistent opposition suggests he views bans as politically risky.

Any such ban would likely be seized on by the opposition and even government MPs in car-dependent regional and outer metropolitan areas.

Car dealers and industry lobby groups focused on legacy combustion engine cars are likely to oppose any legislation speeding up the shift to EVs. But EV makers and charging companies would hail the ban.

Rising EV sales show the community is increasingly supportive. But affordability, range of models and charger reliability remain concerns.

How to build a ban

Any such ban in Australia would have to be legislated or regulated, not aspirational. It would have to come with robust targets for EV uptake and infrastructure expansion offering certainty to manufacturers and markets.

It would have to be paired with steadily tightening fuel-efficiency standards and incentives, as well as fair road pricing and registration reforms to ensure equity.

The charging infrastructure rollout would have to be scaled up aggressively and with particular focus on filling in gaps in rural, regional and remote areas.

Any ban would have to be equitable. This would mean extra support for lower-income and rural households, pragmatic trade-in schemes, and measures to preserve used-vehicle markets so people who can’t yet afford new EVs still have access to affordable transport.

Importantly, the policy must guard against backsliding by limiting loopholes, undertaking regular reviews and building in transparency mechanisms.

The car industry will need transition support such as workforce reskilling and incentives for local manufacturing to support the EV industry.

Any ban should be part of a wider strategy focused on ending subsidies and incentives for fossil fuel vehicles and potentially creating a cost-neutral feebate scheme, where levies on buyers of new high-emissions vehicles are used to offer rebates for zero or low-emission vehicles to offset higher prices.

Examples include France’s Bonus Malus and New Zealand’s Clean Car Discount.

A question of resolve

Banning petrol cars by 2035 isn’t radical – it’s necessary. Voluntary transitions and market forces will be too slow.

Opponents will frame any ban as coercive and unfair. Europe’s experience suggests powerful interest groups will seek to delay or weaken any ban.

A phase-out date cannot be a slogan – it must give certainty and set the direction for the entire transport system.

For car-dependent Australia, a 2035 ban may sound like a tough ask. But without it, transport risks becoming an albatross around our necks. The question now is whether Australia has the discipline to match the ambition.