Australians are delaying car purchases in record numbers, but brokers say demand is being reshaped rather than vanishing.
New national research from mycar Tyre & Auto has revealed that Australians are slamming the brakes on car upgrades, yet asset finance brokers said that inquiry and settlement activity are being reshuffled across brands and borrower types rather than falling off a cliff.
According to the 2026 Mobility Index released by mycar, one in five Australians – 20 per cent – now said they are putting off vehicle purchases indefinitely.
Seven in 10 (70 per cent) reported that higher vehicle prices, steeper interest rates, and broader cost‑of‑living pressures had changed how and when they planned to buy.
The same research also showed a pronounced shift in what people want to drive next.
Almost half of respondents (46 per cent) intend their next vehicle to be a hybrid or electric model, while more than a quarter (26 per cent) said that surging fuel prices were nudging them towards EVs or hybrids.
‘Demand isn’t disappearing – it’s being redistributed’
Yet Will Hamer, director and principal broker at Hamer Asset Finance, said the numbers on the surface didn’t tell the full story.
“Demand isn’t disappearing – it’s being redistributed. The market is in a state of genuine disruption right now, and the headline figures don’t capture what’s actually happening underneath,” he said.
“Toyota’s down materially, but BYD is up triple digits. Legacy brands are losing share at the same rate new entrants are picking it up. From where we sit, we’re writing more deals than this time last year, not fewer.
“What looks like a softening market on the surface is actually a wholesale reshuffling of who Australians are buying from.”
Hamer described his book as busier than last year, yet said that it was increasingly made up of slightly smaller average advances and a broader mix of products.
“Higher deal volume, slightly lower average ticket size. What’s filling the gap is product diversification. We’re writing more debt consolidation, more personal loans sitting alongside vehicle finance,” Hamer said.
He also challenged the idea that cost‑of‑living pressures alone explained the slowdown.
“I’d argue the cost-of-living narrative is a little overstated as a driver right now. What we’re really seeing is our clients’ 2021 lending cycle coming to its natural end,” he said.
“Those terms are maturing now, and clients are being forced into decisions on the lender’s timeline, not their own.”
On the customer mix, Hamer said he was seeing a clear fault line between household borrowers and Australians operating under an ABN.
“The clearest divergence is between consumers and ABN holders. Consumers are still coming through the door with slightly unrealistic expectations – looking at $100,000 vehicles when their servicing realistically supports something well below that,” he said.
“ABN holders are a different story. Sole traders and small-business operators aren’t stepping back from vehicle finance – they can’t, because they need the assets to operate.”
Fuel shock squeezes transport, pushes buyers into EVs
For Daina Howard, asset finance broker at GSC Finance Solutions, the immediate impact of this year’s fuel crisis has been far more visible in inquiry volumes.
“Inquiry numbers definitely began to drop around mid-March to April for vehicle and transport assets, largely due to the fuel crisis,” she said.
“I spoke with several transport company owners who effectively shut up shop because they simply couldn’t afford the fuel costs required to complete long-haul journeys.”
Howard said that the combination of fuel shortages and higher running costs has materially changed buyer preferences – even when it meant paying more upfront.
“Off the back of fuel shortages and rising running costs, there has also been a much stronger demand for EVs and hybrid vehicles,” she said.
“I’ve had several pre-approved clients change their vehicle selection to a hybrid model at the last minute, despite hybrids generally being significantly more expensive than petrol/diesel models.”
Households retrench, businesses restructure
While Hamer downplayed the cost‑of‑living crisis’ impact on buyer intention, Howard said that stressed household budgets and higher mortgage repayments were increasingly impacting borrower demand.
“Cost-of-living pressures and higher mortgage repayments are certainly the primary drivers. Many households have significantly less disposable income than they did a few years ago, which naturally impacts their willingness and ability to take on new finance commitments,” Howard said.
“From a lending perspective, serviceability assessments remain a key focus, with lenders paying close attention to living expenses, existing debt commitments and overall affordability.”
Howard said that borrowers with home loans – especially those who had recently rolled off fixed rates – were the most “cautious” category.
She agreed with Hamer that business borrowers – particularly in the trades – had little choice but to keep investing in vehicles.
“Sole traders and business owners are definitely still buying, particularly within the trade industries,” she said.
“Many trade companies provide company vehicles to employees, creating an ongoing need to expand their fleets. I’ve also noticed a number of SME clients purchasing used vehicles through auction houses, where they can often secure good value for money.”
[Related: Fuel shock triggers rise in electric vehicle lending]
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