Australians have bought more than double the number of hybrid and plug-in hybrid vehicles this year, while the popularity of petrol cars continues to slow down.
But it is unclear whether motorists are motivated by fuel savings as sales of electric cars also stalled in July.
The trends were revealed in sales data from the Federal Chamber of Automotive Industries on Monday, which showed new vehicle sales reached a record 99,486 last month despite challenging economic conditions.
Hybrid vehicles remained the stand-out seller, showing growth of 88 per cent in July and 108 per cent during the year.
Plug-in hybrid electric vehicle sales have also more than doubled during the past year, though from a significantly smaller base.
Even the top-selling vehicle in Australia during July featured a hybrid drive train, with the Toyota RAV4 besting the Ford Ranger and Toyota HiLux that have yet to offer the technology.
FCAI chief executive Tony Weber said the growing popularity of hybrid cars was "consistent with trends in many overseas markets".
In spite of the change, Mr Weber said Australia's automotive industry remained concerned about caps on vehicle fuel emissions to be introduced in January.
"While the first seven months of 2024 have exceeded expectations, the industry remains cautious about the future pending the implementation of the New Vehicle Efficiency Standard, coupled with economic conditions," he said.
Sales of electric cars dipped during July from seven per cent last year to 6.6 per cent, even though they remained up eight per cent over the past year.
Electric Vehicle Council data showed Tesla and Polestar vehicle sales fell 12.9 and 27.3 per cent respectively.
Petrol cars also fell in popularity in Australia, with sales down 8.1 per cent for the year - or more than 27,700 vehicles.
The trend towards hybrid cars was also reflected in a quarterly update from the Australian Automobile Association.
According to its EV index, hybrid vehicles' market share rose from 12 per cent to 15 per cent between April and June, while light petrol cars' share fell from 78 to 75 per cent.
Sales figures over 18 months showed a clear trend towards hybrids and electric vehicles while the popularity of internal combustion engines was "gradually shrinking", according to the association.
Electric Vehicles Council legal, policy and advocacy head Aman Gaur said it was important to note broad trends from the sales data rather than short-term seasonal changes.
"The cost of living is biting across all discretionary sources of spending," he said.
"The actual seasonal factors of the economy changing shouldn't take our eyes off the broader trend here, which is that Australians are taking up electric vehicles - both plug-in hybrids and pure EVs - in greater numbers than they have ever before."
On Thursday, it was revealed electric vehicle prices had fallen below $35,000 for the first time in Australia.
Mr Gaur said the price drop would underline the appeal of electric cars, which were cheaper to operate and crucial to hitting net-zero targets.
"A cheaper electric car, whether it's plug-in hybrid or electric, means that not only is it cheaper to run, but it's cheaper to buy new, and then to get second-hand," he said.
