But hybrid and plug-in hybrid vehicle sales continue to accelerate despite the downturn, and large vehicles remain the most popular models for consumers.
Figures from the Federal Chamber of Automotive Industries show motorists purchased 97,020 new vehicles in September, a 12.4 per cent fall from the same month in 2023.
The drop is the second month in a row vehicle sales have fallen below 2023 levels.
Hybrid and plug-in hybrid vehicle sales continue to rise, despite a downturn in the market. (Lukas Coch/AAP PHOTOS)
FCAI chief executive Toby Weber said it showed economic conditions were convincing motorists to delay their purchases.
"During the early part of the year, we witnessed record (sales) numbers," he said on Thursday.
"However, the September result shows that the state of the economy is impacting purchasing intentions."
Despite the budget trend, figures showed smaller, less expensive passenger vehicles fell in popularity throughout the year, while larger, SUV-style vehicles and utes made up eight in 10 purchases.
Chief Executive Tony Weber said while the sales result to the end of September was solid, the easing in sales compared to the same month last year was an indication of the challenging economic times.— Federal Chamber of Automotive Industries (@FCAI_Au) https://t.co/97TOec1wcT#VFACTS #September2024 #newvehicleindustry #mobility pic.twitter.com/wtl117y30cOctober 3, 2024
"Nine of the top 10 vehicles sold during September were in the medium or large SUV or light commercial segments," Mr Weber said.
"By contrast, the passenger segment was less than 15 per cent of the market."
Figures also showed petrol vehicle sales fell 17.5 per cent during the month, diesel vehicles were down 12.3 per cent, but hybrid and plug-in hybrid vehicles bucked the trend.
Motorists bought more than 13,500 hybrid vehicles in September - a 34.4 per cent rise compared to the same period in 2023 - and more than 2400 plug-in hybrid cars, representing a rise of 89.9 per cent.
A hybrid vehicle, the Toyota RAV4, also claimed the title of Australia's best-selling vehicle for September, followed by Ford Ranger and Toyota HiLux utes.
The Toyota RAV4 was the best-selling vehicle in Australia in September. (HANDOUT/TOYOTA IMAGES)
Electric vehicles did not fare as well as their low-emission cohorts during the month.
Combined sales figures from the FCAI and the Electric Vehicle Council showed Australians bought more than 6400 EVs during the month, down 27 per cent, which represented 6.6 per cent of all new vehicle sales.
Polestar almost doubled its sales compared to September 2023, following its launch of the Polestar 3, but electric market leader Tesla suffered a significant sales decline for its Model Y SUV, with purchases down 60 per cent.
Consumers have also yet to react to record price cuts from MG, which reduced the cost of its electric hatchback in late September to make it the first EV sold in Australia for less than $31,000.
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