RAC’s Best Drives of 2025

There was one shift across Australia’s new car market in 2025 that’s set to go down as a major turning point. It wasn’t the introduction of strict new low vehicle emissions rules. Neither was it the lowest average fuel prices in three years, nor the shift from vehicle supply shortages to oversupply and discounting. The change was linked to those trends though, and it was of course the huge increase in sales of cars made in China.

For the 11 months to November 2025, sales of Chinese-made cars were up 24 per cent compared to the same time frame in 2024, while imports from Japan, Korea and Thailand were all down.

The timing of the New Vehicle Emissions Scheme (NVES) was good for several Chinese brands and models, and the results can be seen on our roads. Vehicles like the $60,000 BYD Shark 6 plug-in hybrid, for example, are now plentiful.

Then in April 2025, the GWM Cannon Alpha PHEV arrived. It was priced at $57,500 drive away at a time when a Ford Ranger PHEV cost $81,200 for the base model. Other affordable arrivals included the Geely EX5 and Leapmotor C10 medium SUVs, while previously released budget-priced small EVs like the GWM Ora and MG4 continued to find buyers.

Established manufacturers have been busy though. Toyota is preparing to launch a fully electric version of the HiLux, plus a new plug-in hybrid RAV4 in 2026. Nissan launched its long-awaited Ayria medium SUV in September, and Mazda’s fully electric 6e mid-sized sedan will arrive in mid-2026.

While 2025 also saw the arrival of the large, six-figure-priced electric SUVs like the Volvo EX90 and Hyundai Ioniq 9, it’s the other end of the market that stands to play a much bigger role in stepping up EV uptake. In 2025, BYD launched a tiny hatchback called the Atto 1, which is priced from $26,140 drive away. The Geely EX2 will offer some competition this year, while the slightly pricier Honda Super-One will be among the other funky affordable EVs hitting city streets, joining the Hyundai Inster that arrived in 2025.

That all said, the roles of petrol, diesel and hybrid vehicles remain, with sales of largely liquid-fuelled utes going strong at the end of 2025, and the arrival of the vastly improved Subaru Forester Hybrid really bringing the fight to the Toyota RAV4 Hybrid.

For now, let’s look back at the best cars we drove in 2025.

When the tiny, electric Hyundai Inster was first launched in Australia in April 2025, its appeal wasn’t, well, instant. Its starting price of around $45,000 was the issue, however by October that had dropped to $39,990, and suddenly the Inster was a viable contender against the likes of the BYD Dolphin and MG4. The Inster’s infotainment system is proven and has some decent development behind it. Now, as a more affordable small EV from an established brand with a wide dealer network, the Inster is in the sweet spot.

Aggressively low pricing of some Chinese-built electric vehicles is nothing new, but finally this year, there’s a difference. Whereas cut-price cars have previously been associated with very poor build quality and worrying safety levels, recent arrivals like the electric BYD Dolphin – which has a surprisingly solid build and a 5-star ANCAP safety rating – are set to change perceptions significantly. Especially given that a very accessible price point makes the Dolphin close
to an ideal small city car.

The medium-sized car segment has been thinned out in recent years, but one of the oldest name badges in it remains the segment’s sales leader and the cheapest to own and run, according to RAC’s 2025 Car Running Costs survey (see page 18). Released in late 2024, the current model Camry remains an economical yet luxurious and reliable high-tech product of Toyota’s decades-long development of its hybrid system.

Draping a three-cylinder, turbocharged all-wheel drive rally-inspired drivetrain in the pumped-up bodywork of a tiny hatchback and calling it the GR Yaris caused a sensation when Toyota did exactly that in 2021. But it was only available as a manual. That didn’t affect sales to its largely enthusiast audience, but why not offer an auto to those who prefer it in what remains the most hilariously hyperactive little car on the market? That’s what we thought.

In 2025, Kia was one of several manufacturers that introduced several small, more affordable EVs with far broader consumer appeal than the huge, six-figure priced electric SUVs that arrived in previous years. At just under $50,000 drive away, the EV3 isn’t the cheapest EV, but it does come with Kia’s smooth, proven infotainment system (lesser EVs often have glitchy user interfaces). Ergonomics are good and of course, there’s also Kia’s seven-year warranty and broad dealer network.

The new 2025 Subaru Forester made some giant leaps forward from its very much underdone hybrid predecessor of 2020. Developed in partnership with Toyota, the new hybrid drivetrain in the Forester is over 31 per cent more powerful than in the first attempt, and yet about 7.5 per cent more economical. As well as a new body design, the new Forester gets important inclusions as standard, such as wireless phone charging, while retaining permanent all-wheel drive. Highly recommended.

Believe it or not, the choices among big, premium-feeling electrified SUVs have increased in the past year, especially electric-only large SUVs. But given its target market of busy families, a plug-in hybrid is sometimes the more practical option. The Mazda CX-80 is a luxuriously finished seven-seater PHEV, which is much more affordable than some European alternatives and is still a strong performer with a smooth and quiet 241kW and 500Nm on hand to move you about. That fuel figure mightn’t be realistic though.

The new Hyundai Palisade launched in Australia in September 2025 and brought with it some major improvements over its immediate predecessor. Most notable is the addition of a 2.5-litre petrol engine and electric motor hybrid system, replacing the diesel and petrol V6 engines in the previous models. The new hybrid Palisade not only has more power and torque than before, but it’s also significantly lighter on fuel, using just 6.8L/100km. It’s available in one high-spec. Calligraphy model that really challenges its Euro rivals on value.

The Prado copped more than its share of criticism when it first hit the market in 2024, but after being around for well over a year, that hasn’t affected demand one bit. The Prado was WA’s most popular large SUV in 2025, selling twice as many compared to 2024 when the old one was still around. With its 48-volt electric motor/generator-assisted drivetrain, the Prado benefits from a smoother-running stop-start system and a little extra shove on acceleration. Initial drives of the Prado in 2024 saw it take a Best Drives gong last year,
and having driven it again in 2025, it’s also the best all-terrain vehicle we drove in 2025.

More than any other ute released in 2025, the GWM Cannon Alpha plug-in hybrid has clearly demonstrated just how many features and tech can be crammed into a large dual cab ute for well under $60,000. The BYD Shark isn’t far behind it, but even that is pricier and rated to tow less. The Cannon Alpha’s extras include a
dual barn door/folding tailgate on the Ultra variant and a sunroof and massaging seats. Warranty is six years. The 1.7L/100km fuel consumption isn’t indicative of real-world use but charge it often and you’ll get close – maybe.