Figures released by the Federal Chamber of Automotive Industries on Wednesday showed drivers bought more than 119,000 new vehicles in June - more than 5000 vehicles down on the same month last year.
The downturn affected sales of SUVs, which make up more than half of all new car sales, as well as light commercial vehicles such as utes.
Sales of electric vehicles also fell during the month, though hybrid and plug-in hybrid vehicles were able to dodge the downturn.
Despite the June drop, Australian consumers still set a car-buying record for the first six months of the year by registering more than 630,000 new vehicles, the figures showed.
Chamber chief executive Tony Weber said the mid-year sales total was encouraging considering the tough economic conditions affecting buyers.
"The end of the financial year has traditionally been a strong month for vehicle sales and achieving 632,412 sales in just six months is testament to the resilience of the market," he said.
But the June figures showed motorists bought 3811 fewer SUVs and 953 fewer light commercial vehicles than June 2023, despite their ongoing dominance in the market.
Electric vehicle sales also dropped by more than 1400, though the chamber's figures did not include 356 sales for Polestar, which quit the motoring body in May over its statements about the government's new vehicle efficiency standard.
But while battery electric cars fell to represent eight per cent of new vehicle sales in June, their sales have risen 16.5 per cent during 2024, with more than 50,200 low-emission models sold.
"We hope to break the significant milestone of 100,000 EV sales in 2024," Mr Weber said.
Hybrid vehicles defied slowing sales in the rest of the market to register a 70 per cent increase in June, with more than 15,300 vehicles sold.
Plug-in hybrid vehicle sales also grew, though from a lower base, with more than 1900 sold.
Despite changing trends, utes continued to top Australia's most popular vehicles.
Ford's Ranger earned the title of top-selling vehicle followed by Toyota's HiLux ute in second place, and the Isuzu D-Max ute in sixth spot.
SUVs claimed the greatest number of places in the top 10, led by the Toyota RAV4 in third place, while Tesla's Model Y SUV was the only electric car to make the list.
Tesla also remained Australia's top-selling electric car brand in June, with a clear margin over its closest rival BYD, though its sales were down by more than 2300 vehicles compared to the same month last year.
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