Number of motor vehicles in New Zealand - Data and Analysis (1988-2034)

The total number of motor vehicles licensed in New Zealand is forecast to increase by 0.9% in 2026-27, to reach 4.71 million motor vehicles. Growth in the population aged 18 and older is expected to push up demand for motor transport, supporting an increase in the total number of motor vehicles in 2026-27. While the anticipated 0.9% growth in motor vehicles reflects a rebound compared to the 0.2% growth witnessed in 2025-26, it remains a modest growth rate compared to the 3.5% average annual growth witnessed between 2015-16 and 2024-25. A major reason for the lag in growth in 2026-27 is likely to be a sharp decline in consumer sentiment, driven by the conflict between the US and Iran. Supply chain disruptions leading to high inflation are likely to limit the number of new motor vehicles purchased in New Zealand, with aggregate real household discretionary income growth prospects suffering from the current economic climate.Growth in the number of motor vehicles typically follows population growth. An increase in the size of the population of driving age increases the potential market size and demand for motor vehicles. New Zealand has a graduated licensing system, with drivers able to obtain a restricted license from 16.5 years of age. Monthly new-car sales reached a record high in June 2023, as pent-up demand from delayed purchases during the pandemic and supply chain issues that delayed deliveries contributed to spikes in sales at the end of lockdowns. 2023-24 also saw the largest recorded increase in the population aged 18 and older, further supporting strong growth in the number of motor vehicles in use. While population growth slowed slightly in 2024-25, it remained above average, contributing to a 1.4% expansion in motor vehicles over the 12-month period. Despite strong performance in 2024-25, a decline in the purchasing power of the New Zealand Dollar in 2025-26 caused the affordability of new imported cars to decline, resulting in only 0.2% growth across the year, marking the lowest annual growth rate since 2009-10.Over the past five years, a key growth sector for new car registrations has been commercial and electric vehicles. Although the pandemic disrupted demand for commercial vehicles, this trend turned around over the two years through 2023-24. As tourists flocked back to New Zealand, a surge in international visitors reignited demand for taxis. This trend also underpinned a sharp rise in the number of rental cars in operation in New Zealand. The number of electric vehicles in New Zealand more than tripled between 2020-21 and 2024-25, supported by a combination of government initiatives and the introduction of new electric models to the New Zealand market by overseas manufacturers. Subsidies for both Battery Electric Vehicles and Plug-In Hybrid Electric Vehicles accelerated growing demand for new electric vehicles throughout 2021-22 and 2022-23. However, electric vehicle uptake has slowed since 2023-24 and 2024-25, as government subsidy programs concluded and cost-of-living pressures made electric vehicles less attractive, given their higher average price tag compared to petrol cars. Evidence of this trend is shown in the number of EV registrations, which fell from 32,715 in 2023-24 to 13,009 in 2024-25, according to data from the Quarterly Economic Monitor. However, EV registrations rebounded to 18,065 in 2025-26, as New Zealand citizens sought alternatives to high retail fuel prices. With global crude oil prices, and therefore domestic motor vehicle fuel prices, on the rise in 2026-27 as a result of the US-Iran conflict, EV vehicle uptake is likely to trend upwards from 2025-26 figures, supporting growth in the total number of motor vehicles. Overall, IBISWorld anticipates the number of motor vehicles to rise at a compound annual rate of 0.9% over the five years through 2026-27.