Australia’s car buying journey gets longer and more complex

Australia’s car market may appear stable on the surface, but the journey buyers take to reach the dealership is becoming longer, more complex and far less predictable.

New research from carsales suggests Australians are looping, pausing and restarting their car-buying journey at sharply higher rates, as cost-of-living pressures, expanding vehicle choice and new digital tools reshape how buyers make decisions.

The findings, from Australia’s Car Buyer Report 2026 developed with advisory firm Nature, reveal the visible shopping window represents only a small part of the real purchase journey.

According to the report, 63% of buyers backtracked at least once during their research process - a 17% increase compared with 2023. Meanwhile, 34% paused or stopped their search altogether, up 6%.

The behaviours often emerge early in the journey, when buyers juggle competing priorities including budget constraints, feature comparisons and financing options.

Carsales managing director Craig Fraser said the industry often underestimates how much work buyers do before they ever submit an enquiry or visit a dealership.

“Australia’s Car Buyer Report 2026 makes it clear that the visible shopping window is only a fraction of the real journey,” Fraser said.

“From the outside, buyers can look decisive. But when you look closer, you see they’re spending months trying to get things right - testing ideas, adjusting budgets and making sense of a lot of competing information.”

“The real moments that shape momentum aren’t always the obvious ones. They’re the pauses, the second-guessing, the backtracking and the confidence dips that happen long before someone appears at a dealership.”

Stable sales mask deeper shifts

The findings land against a backdrop of relatively stable new vehicle sales.

According to VFACTS data from the Federal Chamber of Automotive Industries, Australia recorded 87,092 new vehicle sales in January 2026 - a marginal 0.3% increase on the same month last year.

However February figures point to early signs of softening demand, with sales falling 4.5% year-on-year to 90,712 vehicles.

FCAI chief executive Tony Weber said the January result reflected steady consumer demand across key vehicle segments.

“January’s figures show a market that is stable, with Australians continuing to purchase vehicles that meet their needs for work, family and lifestyle,” Weber said.

Beneath that stability, however, the mix of vehicles buyers are considering is shifting quickly.

Hybrids surge as EV enthusiasm cools

Hybrid vehicles are emerging as the fastest-growing powertrain choice among Australian buyers.

The research found hybrid purchases among new car buyers have increased by 15% since 2023, the strongest growth of any fuel type.

Looking ahead, 42% of buyers say they intend to purchase a hybrid, compared with 24% intending to buy a fully electric vehicle.

In January, hybrid vehicles accounted for 17.4% of new vehicle sales, while battery electric vehicles represented 8.4% of the market. Plug-in hybrid sales reached 5,161 units, a 170% increase year-on-year.

At the same time, petrol vehicles recorded a 14% decline.

AI enters the car research stack

Another emerging influence is artificial intelligence. For the first time, AI ranked among the top ten influences in car research, sitting sixth overall. Rather than replacing traditional sources, the technology appears to be adding another layer to the research process.

Car review and comparison sites influence 51% of buyers, up from 47% in 2023. OEM websites influence 30%, while dealer websites influence 26%.

AI tools are increasingly used alongside these sources to compare models, decode industry jargon, clarify finance options and verify information.

Among buyers who use AI tools, 42% rely on them daily during the research process.

Usage is particularly strong among new migrants and highly detail-oriented researchers.

Trust gaps slow decisions

Despite the growing number of research tools available, trust remains a major friction point in the car-buying journey.

The report found 62% of buyers struggle to determine which sources they can trust when they begin researching vehicles.

Meanwhile 59% worry about making the wrong decision. These concerns are most pronounced among women, younger buyers and new migrants - groups that are more likely to revisit earlier stages of the journey to rebuild confidence.

Cost-of-living pressures are also reshaping how buyers define value.

“Good value for money” and “within budget” now rank as the most important considerations across all generations.

As budgets shift during the research process, buyers are increasingly reopening their shortlist to include newer and more value-led brands.

That dynamic is quietly redrawing the competitive landscape of the Australian car market.

Fraser said the key for automotive brands and dealers is designing experiences that support the full journey, not just the final purchase moment.

“When brands, dealers and lenders design for the full journey - not just the moment of purchase - they reduce complexity, strengthen trust and support buyers the way they actually need to be supported,” he said.