Passenger Demand Holds, Commercial Sector Eases, And Lower-Emission Uptake Grows

Market Volumes and Demand Dynamics

New Zealand’s new vehicle market continues to show signs of stabilisation, with March 2025 registrations up 2.6% year-on-year. While headline volumes remain steady, underlying trends point to a market in transition, with clear shifts emerging between vehicle segments.

Light passenger vehicles now account for the majority of registrations, supported by somewhat resilient consumer demand. In contrast, the commercial sector remains under pressure. Light commercial registrations decreased by 8.7% compared to March 2024, while heavy commercial volumes declined sharply, down 39% from March 2024. The first quarter reinforces this trend, with year-to-date heavy commercial registrations sitting at a similar level, 38.4% below the same period last year.

“This is a clear signal of shifting dynamics within the commercial sector,” said Aimee Wiley, Chief Executive of the Motor Industry Association. “Rather than expanding fleets, operators appear to be focusing on utilisation and efficiency, managing through a period of softer demand. Heavy vehicle registrations were likely supported by earlier forward orders, but the steep year-to-date decline suggests that underlying demand is now being tested as economic headwinds weigh more heavily on investment decisions.”

Motive Power and Lower-Emission Uptake

Alongside these volume trends, New Zealand’s vehicle fleet continues to evolve in terms of powertrain preferences. Hybrid vehicles remain the strongest performers in the passenger market, now accounting for one in every three new registrations. Consumers are engaging with lower-emission technologies, although the uptake of fully electric vehicles is progressing at a more subdued pace.

The commercial sector is also beginning to reflect this shift. “We’re seeing a notable shift in the light commercial segment, with strong early adoption of new, lower-emission offerings,” Wiley said. Hybrid, plug-in hybrid, and battery electric light commercial vehicles accounted for 19.6% of registrations in March and 23% year-to-date. This signals a growing intention among businesses to diversify their fleets and explore practical alternatives that align with their emissions reduction goals and day-to-day operational needs.

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