The UK new car market grew for the third year in a row in 2025, passing the two million mark for the first time since the pandemic, with 2,020,520 new car registrations, according to the latest figures published today by the Society of Motor Manufacturers and Traders (SMMT).* Internal combustion engines remain the biggest selling powertrain but there remains growing demand for electrified cars with one in four buyers choosing electric vehicles. [There also continues industry lobbying demands to delay and use taxpayer subsidies to support the sales of EVs. -AutoCrat]

“Massive manufacturer investment now provides a choice of more than 160 BEV models – up from just over 130 at the start of 2025 – with at least 60 more due in 2026. However, EV uptake has risen by only 23.9%. The long-awaited return of a grant for EV purchase has helped, although only around a quarter of models are currently eligible for the incentive at any level. It is manufacturers, therefore, that continue to shoulder the burden of driving up demand, subsidizing their sale by more than £5 billion in 2025, equivalent to a massive £11,000 per BEV registered. (footnote 4) Such subsidies are clearly unsustainable. Furthermore, the announcement of a new ‘eVED’ tax on EVs purchased from 2028 sends a confusing message to consumers, undermining rather than encouraging market confidence.

“The average new car CO2 has fallen by -10.1% from 2024 to 91.8 g/km, which will assist some manufacturers with mandate compliance, the UK’s zero emission sales target will next year require BEVs comprise one in three new car registrations. The UK already has the most ambitious transition trajectory of any major market and, with the EU’s proposal to revise its end of sale date from 2035, divergence between the UK and the much larger market on its own doorstep is broadening.

“Action is needed from government to ensure the British market remains attractive for investment, and one which supports consumers, the industry and the economy. The forthcoming review of the ZEV Mandate will be a crucial opportunity to ensure the transition supports the UK’s international competitiveness and prosperity, as well as its shared decarbonisation goals,” SMMT said.