The government has exposed the car brands that did or didn't meet the government's tough CO2 emissions rules for new vehicles – and it's good news for BYD, but not Mazda.
Mazda, Nissan and Subaru are the car brands in line for the biggest fines – up to $51 million – for failing to meet the first phase of Australia's tough emissions rules for new vehicles.
And the fines are only slated to grow in 2026 – potentially doubling or tripling for some car companies – as the rules get tougher, and regulators track a full year of vehicle imports, not just half, as in 2025.
It will see struggling car brands turn to the likes of BYD, which beat the targets by such a margin that it can sell 'credits' to struggling rivals capable of offsetting up to $628 million in fines, followed by Toyota's $289 million and Tesla's $221 million.
A number of top car brands have already begun to increase vehicle prices in showrooms to pay for the penalties for failing to meet the new rules which, by the end of the decade, will see even a Toyota RAV4 or Hyundai Tucson Hybrid in the red.
Data published today by the Federal Government has revealed that only about two-thirds of companies importing new vehicles last year met the government's CO2 emissions targets, known as the New Vehicle Efficiency Standard (NVES).
The rules set targets for the CO2 emissions of each new vehicle imported by a manufacturer, and hand out hefty financial penalties to brands that sell too many high-emissions models and fail to meet the rules.
Car brands are given two years to offset a negative balance by beating the targets in later years, or purchasing 'credits' from rival manufacturers that hit the targets.
New data shows Mazda would need to buy more credits than any other brand in 2025, accruing enough 'debits' – or "liabilities", as described by regulators – to pay $25,425,850 million in fines.
It is based on a penalty of $50 per gram per kilometre of CO2 over the limit, per vehicle, when paid on time. Miss the deadline, and the penalty doubles to $100 per g/km per car, for a total of $50,851,700 to federal regulators.
The staggering penalty 'only' equates to $661 per vehicle imported – as the fines are based on vehicle arrivals, not sales, a loophole reported upon by Drive – and is billed to the manufacturer, not consumers.
However, top brands have warned that prices in showrooms will rise to pay for the fines, something the likes of Hyundai and Ford have already begun to do.
Attracting the second-most fines is Nissan, which is on the hook for $10.8 million at the standard rate, or $21.5 million if it pays late.
Nissan's fine is based on a higher per-vehicle fine of $776, likely not helped by its 2025 sales including 6263 Patrol four-wheel-drives with thirsty, high-pollution V8 petrol engines that pushed up its average CO2 output.
Subaru does not sell a ute or 4WD, but it placed third, liable for $7 million in fines at the standard rate, or $14 million at the late-payment figure, for the vehicles it imported between 1 July and 31 December 2025.
Rounding out the Top Five are Hyundai – at $4.23 million to $8.46 million, despite selling a range of electric cars – and the combination of the Chevrolet, Cadillac, and GMC brands, at $3.3 million to $6.6 million.
Absent from the list of the highest fines are Ford and Isuzu, two brands which – surprisingly – earned credits for their 2025 imports, despite specialising in heavy-duty diesel four-wheel-drives.
It is because, in the first year of the policy, the targets are lenient enough to allow a Ford Ranger bi-turbo and every Isuzu D-Max to remain in the black and earn credits.
Even a Ford Ranger Wildtrak V6 would only attract an estimated penalty of about $200 for each example imported in 2025.
However, in 2029 – as the rules get tougher – the credit equivalent to about $1000 on an Isuzu D-Max X-Terrain becomes a penalty of approximately $9000 per vehicle sold.
Topping the list of brands with the most 'credits' to sell is BYD and its Denza brand, which earned a staggering 6.3 million 'units', equivalent to offsetting $314 million in fines at the base rate – or $628 million if paid late.
It earned so many credits that it could extinguish the penalties facing all 16 manufacturers in negative territory five times, and still have some left in reserve.
Car brands are not paid by the Federal Government for meeting the rules; rather, the monetary figures in this story reflect the value of the fines that the credits they earned can offset.
Following it on the credits list is Toyota and its luxury division Lexus, which earned enough 'units' to offset $144 million in fines at the base rate, or $289 million at the higher rate, followed by Tesla on $110.6 million and $221.2 million, respectively.
Toyota may not be celebrating, as the popular hybrids that helped it meet the rules in 2025 will lose their advantage as the CO2 targets get tougher, with even a RAV4 Hybrid into the red by 2029.
Completing the Top Five were Kia ($36.5 million to $73 million) and new Chinese brand Geely ($31 million to $62 million).
Ford earned enough credits to offset $22.6 million in future fines at the base rate, while Isuzu – which also includes N Series trucks in its tally, due to the way the NVES is set up – can offset $18.3 million.
Niche electric-car specialist Polestar ($14 million to $28 million) can offset all of Nissan's fines, despite only importing 1639 cars.
Additional insights published by the NVES Regulator include:
Alex Misoyannis has been writing about cars since 2017, when he started his own website, Redline. He contributed for Drive in 2018, before joining CarAdvice in 2019, becoming a regular contributing journalist within the news team in 2020. Cars have played a central role throughout Alex’s life, from flicking through car magazines at a young age, to growing up around performance vehicles in a car-loving family. Highly Commended - Young Writer of the Year 2024 (Under 30) Rising Star Journalist, 2024 Winner Scoop of The Year - 2024 Winner
