Further investment in critical rail infrastructure will transform public transport networks and connect communities to more affordable housing and job opportunities, the Australasian Railway Association (ARA) says.

ARA CEO Caroline Wilkie welcomed $3 billion for new rail projects in the Federal Budget 2025-2026, as part a total $17.1 billion investment in new and existing transport infrastructure projects.

The Federal Budget 2025-26 allocated $2 billion to upgrade Sunshine Station to support the delivery of the first rail link to Melbourne Airport and $1 billion to preserve rail corridors to the new Western Sydney International Airport.

“These funding commitments confirm what we already know – that investment in rail delivers huge economic, environmental and social benefits, as we have seen with the successful Sydney Metro,” Wilkie said.

“Investment in major rail projects future-proofs communities along the rail corridor. It supports more affordable housing, takes thousands of cars off the road and connects people to more job opportunities, health and education precincts.”

Meanwhile, both the Victorian Automotive Chamber of Commerce (VACC) and the Motor Trades Association NSW met the Budget mostly with positive reaction, though indicated there was room for improvement.

The VACC welcomed initiatives such as strengthened franchising protections and apprenticeship support, though said it falls short on addressing the industry’s transition to electric vehicles and relief from operational cost pressures.

VACC CEO Peter Jones expressed disappointment over the government’s decision to maintain existing automotive tax structures, including the Luxury Car Tax and Passenger Vehicle Tariff, which are expected to generate nearly $1.55 billion in revenue this financial year.

“These taxes were designed when Australia manufactured domestic vehicles and are now outdated. They often apply to more efficient vehicles and those with advanced safety features, ultimately discouraging consumer uptake of better technology,” Jones said.

The Budget’s limited support for businesses managing the transition to electric vehicles was also highlighted as a missed opportunity.

“Victorian automotive businesses face substantial capital costs to update facilities and equipment to service electric vehicles. The absence of targeted government support for this transition places an unfair burden on small businesses that are essential to maintaining Australia’s vehicle fleet,” Jones said.

The MTA NSW echoed the VACC saying the Federal Budget falls short in a number of areas concerning the mobility sector, including: the energy bill rebate being inadequate, the absence of any direct funding support to automotive workshops for the tooling upgrades required for EVs and a failure to extend the Fringe Benefits Tax exemption for plug-in hybrids.

MTA NSW CEO, Stavros Yallouridis, said despite the continued support for the interim Australian Apprenticeship Incentive System for a further six months, which was welcomed, there remains a lack of real action when it comes to addressing EV training for technicians and skills shortages.

"While we appreciate the government's focus is on cost of living pressures, further support is needed for the many small and family-owned automotive businesses, which our industry is made up of and who form the backbone of the Australian economy,” Yallouridis, said.

“The absence of direct subsidies or tax incentives for workshop equipment and tooling, to service and repair electric vehicles represents a critical oversight. Automotive businesses already have thin margins, and the cost of updating their workshops, installing charging infrastructure, and putting their employees through the necessary skills training is costly and prohibitive. The financial barriers are significant and our industry needs support to ensure we can safely and effectively service the next generation of vehicles.

“We're also disappointed that the Fringe Benefits Tax exemption for plug-in hybrids has not been renewed. These vehicles provide an accessible pathway to reduced emissions, particularly for rural communities facing limited charging infrastructure and families grappling with range anxiety and escalating cost of living expenses.

“With automotive jobs consistently featuring on skills shortage lists, further investment in the vocational education sector is integral to address the critical talent gap, which continues to cripple our industry.”