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Europe’s new-car market is shifting. Emissions policy changes, uneven electric vehicle (EV) adoption, and contrasting carmaker strategies are revealing gaps. But how does this impact forecasts moving forward? A new outlook webinar will answer this question and more. Europe’s automotive industry stands at an inflection point.Growing geopolitical and economic uncertainty, plus shifting national and regional policies, are impacting the market. This comes as EV adoption across the continent continues to diverge, driven by country-specific differences, plus new technologies and brands. But what effect does all this have on Europe’s new-car market forecast for 2026 and beyond? Does the European Commission’s new Automotive Package materially change expectations? Plus, what are the hidden factors of EV adoption causing contrasting trends across the bloc? To get answers to all these important questions and more, register now for Europe’s Auto Forecast 2026: Technology, Policy, and EV Adoption. This free online event will take place on 1 April 2026, at 9:30 BST / 10:30 CEST. register now Exploring Europe’s new-car forecast Attendees of the upcoming webinar will hear from leading European automotive experts. Identifying actionable trends that will shape the industry over the next 12 to 24 months, the event’s panel will include: Dr Christof Engelskirchen, chief economist and director of professional services, JD Power (Europe) Marco Pasquetti, cluster head of valuations for Spain and Italy, JD Power (Europe) Idesbald Vannieuwenhuyze, cluster head of valuations for Belgium and the Netherlands, JD Power (Europe) Neil King, head of forecasting, EV Volumes, JD Power (Europe) Tom Hooker, journalist, Autovista24 The panel will discuss Europe’s new-car market outlook across multiple powertrains. The impact of the European Commission’s Automotive Package and the UK’s zero-emission vehicle mandate will also be examined. Furthermore, the webinar will explore the reasons behind Europe’s diverging EV adoption. The panel will evaluate what factors are limiting some countries and what is enabling others to forge ahead. This includes the strength of charging infrastructures, purchasing power, natural resource levels and EV running costs. The effect of upcoming model launches and new technologies on Europe’s new-car market will be reviewed too. This is important as these new developments may not have the same impact across all markets. Forecast for many sectors The insights delivered in the webinar will be valuable to a wide-ranging audience from across the automotive sector. This will include: OEMs, pricing and product managers Fleet, leasing, and residual value managers Finance, insurance, and risk analysts Portfolio and remarketing managers Industry executives and business analysts The online event will end with a question-and-answer session. Attendees will be able to submit queries directly to the panellists. Any questions not answered during the webinar will be addressed afterwards via email. Register now for: Europe’s Auto Forecast 2026: Technology, Policy, and EV Adoption. The free online event will take place on 1 April 2026 at 09:30 BST / 10:30 CET. Meanwhile, check out the previous webinar on what to expect from used-car markets this year. Catch up on Autovista24’s coverage and watch the full session: 2026 residual value outlook: Regional shifts and trends.

While the UK new-car market started 2026 positively, battery-electric vehicles (BEVs) struggled as external circumstances impacted registrations. But how did plug-in hybrids (PHEVs) push the country’s overall market to growth? Autovista24 special content editor Phil Curry explores the data. The UK’s new-car market started 2026 with a year-on-year improvement. However, growth was predominantly driven by the PHEV market, as BEV demand stagnated.  In total, 144,127 new passenger cars were registered during January. This was a 3.4% improvement, according to data released by the SMMT. The month is traditionally a slower one for new-car deliveries in the UK, highlighted by the unit-total increase of just 4,782 models.  January marked a second consecutive month of improvement, and the country will be hoping for a better start to 2026. January 2025 began a rollercoaster year with a decline, the first of six monthly volume drops in the 12-month period.   Should February prove positive, it would be the first period of three or more successive months of growth since between August 2022 and July 2024. This highlights the market’s inconsistent performance since August 2024.  However, the SMMT is optimistic about 2026. The UK motoring authority has revised its forecast from October 2025, and projects a 1.4% rise in volumes across the year. This would mean the delivery of 2.048 million units.   But some powertrains came up against strong results from January 2025, creating a challenging picture for the beginning of 2026.  Influences on BEVs  The UK’s BEV market stalled last month, as exceptional circumstances combined to impact figures. With 29,654 registrations, volumes increased by just 0.1%. This equated to 20 more all-electric units being taken to UK roads compared with January 2025.   This was the worst year-on-year performance since December 2023. Both these poor results are the work of external market dynamics. At the end of 2023, carmakers held back BEV registrations. This was so that deliveries counted towards the zero-emission vehicle (ZEV) mandate. The move resulted in a 34.2% decline in December’s figures.  Fast forward to January 2025, and another market change led to a three-month period of growth above 40%. In this instance, it was the introduction of vehicle excise duty (VED) in April 2025 that caused a pull-forward effect. Drivers rushed to have their BEVs registered before the implementation, to avoid an initial one-off VED cost.   There was another pull-forward effect at the end of 2025. Carmakers rushing to meet the year’s ZEV mandate target may also have impacted January figures. These combined factors, together with a traditionally slower month for deliveries, have skewed the overall BEV result.  This left the powertrain with a market share of 20.6%, the lowest recorded since April 2025. This was also a drop of 0.7 percentage points (pp) compared to January 2025. This may be a concern for the industry.  Difficulty for BEVs ahead?  In 2026, the ZEV mandate target for carmakers to achieve is 33% of their fleet. This is up from 28% last year. The overall market only achieved a 23.4% share across 2025, so starting with a decline is not the optimal position for the sector to be in.  However, the SMMT has revised its forecast for BEV uptake from its previous October predictions. The powertrain is expected to reach a 28.5% share of the UK new-car market by the end of this year. This would represent progress over 2025, but still fall short of the mandated target.  Still, the industry body is calling for a holistic review of the UK’s transition to BEVs. The country is still on course to ban sales of new petrol and diesel models from 2030. This is despite a pushback on similar plans in the EU.   Alongside the Electric Car Grant incentive scheme, the government launched a campaign in January highlighting the benefits of going electric. However, this will need to combat the new eVED pay-per-mile scheme set to come into effect in 2028. With this in mind, the SMMT believes demand will be further suppressed in the coming years.   ‘Britain’s new car market is building back momentum after a challenging start to the decade. It is also decarbonising more rapidly than ever and, despite a January dip in EV market share, the signs point to growth by the end of the year,’ commented SMMT chief executive Mike Hawes.  ‘The pace of the transition, however, may be slowing and is certainly behind mandated targets. With sales of new pure petrol and diesel cars planned to end in less than four years, there needs to be a comprehensive review of the transition now, to ensure ambition can match reality,’ he concluded.  PHEVs provide relief  BEV’s electric vehicle (EV) stablemate, PHEVs, provided the uplift needed for the new-car market to achieve growth. Without the 18,557-unit total achieved by the powertrain, the whole market would have experienced a 0.9% decline.   The additional 5,959 units equated to a 47.3% year-on-year increase. This marked the technology’s best performance in terms of volume and percentage growth since September 2025. It also represented a continued streak of double-digit improvements that stretches back to February 2025.   This also meant PHEVs achieved a 12.9% market share, up by 3.9pp. This left the powertrain just 0.5pp behind the full-hybrid (HEV) market. PHEVs closed this gap across 2025, with the powertrains’ shares split by 4.2pp in January of last year. This is a trend that looks set to continue in 2026.  Combining BEV and PHEV volumes, the EV market saw 48,211 registrations in January. This was 14.2% higher than 12 months prior. This allowed for a 33.5% market share, up 3.2pp.   However, EVs were unable to repeat their December high of beating the internal-combustion engine (ICE) model share. This was thanks in part to the poor BEV performance, together with a stronger ICE result in the month.  Slow times for HEVs  The UK records hybrid registrations differently from other major European markets. Only full-hybrid (HEV) figures are counted in this category, while mild-hybrid totals are merged with their respective petrol and diesel counterparts.  In January, 19,297 HEVs were registered, a 4.8% improvement year on year. This equated to a rise of 884 units and a 13.4% market share, up 0.2pp.   The powertrain has seen slow growth in the UK. During 2025, the only months with double-digit volume rises were the plate-change periods of March and September. This allowed PHEV registrations to catch up, setting up an intriguing battle between the two hybrid technologies this year.  Combining HEV and EV figures, electrified vehicles recorded 67,508 registrations last month, up 11.3% year on year. This gave the grouping a 46.8% market share, up 3.3pp, but not high enough to topple the ICE segment. This was the first time since August 2025 that electrified powertrains were not the dominant grouping in the country.  ICE slide slows  Petrol registrations continued to decline in January. However, their 1.9% fall was the best monthly result since a 2.4% improvement in September 2025. In total, 68,757 units were delivered to customers, a drop of 1,318 units.   January marked the fourth month in a row of single-digit declines, suggesting the market’s fall is slowing. The 47.7% market share recorded in the month was down by just 2.6pp. This was the fuel type’s best result since May 2025.  Meanwhile, diesel deliveries fell by 8.8%. However, with 7,862 units, this was a drop of just 763 registrations year on year. The powertrain took 5.5% of the UK’s total volume, a fall of 0.7pp.  Combined, ICE registrations achieved 76,619 units, a fall of 2.6%. The powertrain group returned to dominance in the month, with a 53.2% hold of the market, down 3.3pp.  The slowdown in the ICE decline helped the UK’s overall growth in January. However, with the new ZEV mandate and the resurgence of PHEVs, 2026 could see swings towards electrified models. 

Is China’s lead insurmountable? Could Northern America make a comeback? What does the Automotive Package mean for Europe? How are the non-Triad markets faring? EV Volumes’ head of forecasting, Neil King, unpacks the latest predictions with Autovista24 editor Tom Geggus. Covering passenger cars and light-commercial vehicles (LCVs), EV Volumes has stepped up its global light-vehicle market forecast. Data for 2025 is expected to confirm 92.7-million-unit sales, up by 4% year on year. This is compared with the 3.6% growth outlined in September’s forecast. EVs, including battery-electric vehicles (BEVs) and plug-in hybrids (PHEVs), are predicted to make up 25.5% of these sales. This means approximately 23.7 million new plug-in vehicles will hit roads worldwide. Moving forward, improved outlooks in China, the non-Triad markets, and Europe offset the downgrade to Northern America. The global electric vehicle (EV) share is forecast to reach 27.5% in 2026, 43.2% in 2030, 64.6% in 2035, and 83.2% in 2040. That said, budget pressures and policy shifts may threaten investment in incentives and charging infrastructure. Various legacy vehicle makers are reducing their EV targets. This has further weakened the outlook for EV adoption in Northern America. China’s booming EV market The EV boom has continued in China, with the plug-in share rising from 13.9% in 2021 to 44.3% in 2024. The market’s strength is supported by favourable total cost of ownership and increasingly competitive pricing. Given economic headwinds, the Chinese government has focused on boosting domestic consumption, with additional support directed toward state-owned OEMs. The economic situation appears positive, with the OECD upgrading the 2025 GDP growth outlook for China to 5%. Vehicle demand also remains resilient. EV Volumes has slightly upgraded its 2025 light-vehicle sales forecast to 27.8 million units, up 7.1% year on year. A scrappage programme was extended beyond the original January 2025 deadline. However, it has been suspended in several cities, which could disproportionately reduce demand for EVs given their higher bonus levels. Additionally, in October 2025, China ended its national EV subsidy programme, as reported by Reuters. It also excluded new-energy vehicles (NEVs) from the list of strategic emerging industries in its latest five-year development plan. This includes EVs, extended-range electric vehicles (EREVs) and fuel cell electric vehicles (FCEVs). While direct subsidies are gone, purchase tax exemptions remain in place, although they are expected to phase out by 2027. Also, some local governments still offer targeted incentives. Targets to hit In 2025, China set a target of approximately 15.5 million total NEV sales. The country also pledged to reduce its greenhouse gas emissions by 7% to 10% by 2035. This marked the nation's first commitment to absolute emissions cuts. PHEVs have taken an increasing share of the EV market. This rose from 18.3% in 2021 to 42.3% in 2024 and was largely due to strong sales of BYD and Li Auto EREVs. While Chinese OEMs continue launching new PHEVs and EREVs, BEVs are regaining momentum, bolstered by aggressive discounting initiated by BYD. As such, BEVs are forecast to account for 61.2% of EV sales in 2025 and about two-thirds by 2031. In China, EVs are forecast to represent 56.4% of all light-vehicle sales in 2025. This is set to increase to 76.4% in 2030, 89.7% in 2035, and 96.1% in 2040. Forecast volumes are based on retail sales (not wholesales), excluding exports and inventory build-up. This explains the difference from the typically higher wholesale-based figures published by other agencies. Barriers in Northern America In Northern America, including the US and Canada, light-vehicle sales rose by 2.9% in 2024, following 12.4% growth in 2023. The EV share increased from 9.4% in 2023 to 10.2% in 2024. In contrast to China, the region’s electrification looks to have lost a lot of energy. Last year saw multiple major influencing factors hit the region’s light-vehicle market. Canada saw funding for the iZEV programme run out in January, with BEV uptake falling and no replacement scheme announced. In March, the US government announced 25% import duties on vehicles. Then the ‘One Big Beautiful Bill’ act ended EV tax credits in September. Ford dropped plans for several all-electric models in the US and is replacing the all-electric F-150 Lightning with an EREV version. It was not alone, with Stellantis making similar strategic shifts, TechCrunch reported. This points to a greater share of PHEVs and EREVs as manufacturers balance electrification with customer preferences and profitability pressures. EV Volumes has slightly increased the 2025 light-vehicle sales forecast for Northern America to 18.2 million units. This is up 2% year on year. The EV share is now expected to reach 9.9% in 2025 and rise only modestly to 10.1% in 2026. These small gains will be primarily supported by Canada and the rollout of more affordable models. This includes the standard versions of the Tesla Model 3 and Model Y. EV shares are then expected to climb to 20.9% in 2030, 39.3% in 2035, and 58.6% in 2040. This is well below the predicted global EV share of over 83.2% in 2040. European market uncertainty Western and Central Europe’s light-vehicle market grew by 1.7% year-on-year in 2024, following 14% growth in registrations in 2023. Changing goods tariffs, developments in Ukraine, and ongoing tensions in the Middle East have all created regional sales uncertainty. The possibility of higher inflation, oil prices, and energy costs could also lead to weaker private consumption. However, the OECD's December 2025 economic outlook predicts that GDP in the Euro area will gain 1.3% in 2025. This is slightly higher than the September outlook, which anticipated 1.2% growth. The EU proposed tariff reductions in August, enabling the EU-US trade agreement. This lowered duties on the automotive sector from 27.5% to 15%. The recently ratified EU-Mercosur and EU-Mexico free-trade agreements have also boosted the region’s automotive competitiveness. Low rate of growth EV Volumes forecasts that light-vehicle sales in Western and Central Europe will grow by 0.3% year-on-year in 2025. This is higher than in the September 2025 forecast, which projected a 1% decline. At 15 million units, this is far below the 18 million light vehicles registered in 2019. EV Volumes does not expect the European market to return to 2019 levels within the current forecast horizon, up to 2040. A slight dip in demand is also expected in 2030 and 2035. Demand will likely be pulled forward into 2029 and 2034, triggered by the stricter EU emissions targets. Stagnation in 2040 reflects the underlying cycle effect. Earlier peaks in replacement demand and fleet renewals unwind, and the market normalises after several years of elevated recovery volumes. Light-vehicle sales are expected to grow by 1.7% in 2026, hinging on a complex interplay of regulatory and economic factors. EV Volumes forecasts that European EV sales will grow 30.2% year on year in 2025 to 3.99 million units. This means they will represent 26.6% of all light-vehicle sales. BEV volumes are forecast to grow 28% year-on-year, accounting for 67.5% of all EV deliveries in 2025. PHEV sales are expected to increase by 35.1%. EVs will reach a 31.1% share of European light-vehicle sales in 2026 and 36.6% in 2027. This will be driven by new model launches, lower prices, and stricter emissions targets. EU Automotive Package In December 2025, the European Commission unveiled its Automotive Package. It introduced a revised CO2 reduction pathway and compliance mechanisms between 2030 and 2035. Previously, carmakers had to cut tailpipe CO2 emissions of passenger vehicles by 100% by 2035. Under the proposal, they will instead need to reach a 90% reduction compared with 2021 levels. The remaining 10% will be offset through low-carbon steel, e-fuels, and biofuels. So, PHEVs, EREVs, FHEVs, mild hybrids, and even pure internal-combustion vehicles (ICE) could remain available beyond 2035. The package also suggests greater flexibility for the 2030 target. Manufacturers could get a three-year compliance period between 2030 and 2032 to achieve the 55% emissions reduction. For LCVs, the 2030 CO2 reduction target would be eased from 50% to 40%, acknowledging slower electrification progress. Additional proposed measures include mandatory zero and low-emission fleet share targets at the member-state level. There could also be updated labelling rules for EV range and energy consumption. ‘Super credits’ for small, affordable EVs produced in the EU are on the table too. A €1.8 billion battery support package is proposed to accelerate the European battery value chain as well. The proposal remains subject to approval by both the EU Parliament and the EU Council. This means it is not reflected in EV Volumes forecast. However, if adopted as outlined, EVs may only account for between 55% and 60% of European light-vehicle sales by 2030. This would increase to between 80% and 85% by 2035. By 2040, this may hit between 90% and 95%. These projections assume emissions balancing between 2030 and 2032 and continued alignment of national policies. Several markets, such as Norway, Sweden, and the Netherlands, are likely to maintain stricter targets. While currently committed to a 2030 ICE ban, the UK is expected to follow the EU’s revised framework. Non-Triad measures In non-Triad markets, EV volumes rose for the fourth consecutive year in 2024. This was thanks to greater product availability, stronger incentives, and lower import duties in selected countries. Combined EV sales reached 1.36 million units in 2024, up 34.2% year-on-year. Light-vehicle sales managed the economic impact from US trade tariffs better than expected in 2025. However, EV Volumes has slightly decreased the 2025 light-vehicle sales growth forecast to 4.4%. Indonesia introduced VAT exemption for low-emission vehicles in January and a reduced VAT rate thereafter. Japan increased the budget for EV subsidies under the Clean Vehicle Energy Subsidy Programme. India cut import duties for premium EVs as part of a new manufacturing programme in June. Thailand revised its EV policy to encourage exports and prevent domestic oversupply. Each EV produced for export now counts as 1.5 units toward local production obligations. In response to US tariffs, South Korea launched temporary stimulus measures. This includes financing support and higher EV subsidies. It is also planning additional tax exemptions for EVs. Accordingly, the EV share in non-Triad countries is forecast to reach 6.9% in 2025, hitting around 2.2 million units. However, budget constraints driven by economic concerns may limit future incentive schemes. Several countries have introduced new tariffs on imported vehicles. This includes a 50% tariff in Mexico and up to 30% duties in Turkey. There will also be an end to incentives for imported, completely built-up BEVs in Indonesia. The EV share is projected to reach 17% in 2030, 41.8% in 2035, and 76.8% in 2040. This generally lags the global adoption curve by about five years until 2035.

The UK’s new-car market ended 2025 with growth. But what happened with battery-electric vehicle (BEV) deliveries? Did they reveal a zero-emission vehicle (ZEV) mandate problem? Autovista24 special content editor Phil Curry reviews the numbers. The UK’s new-car market ended 2025 well, growing 3.9% year on year in December, according to data from the SMMT. In total, 146,249 passenger cars were delivered to customers in the month, 5,463 units more than in December 2024. December was the sixth month of improvement for the UK market last year. With a uniform mix of ups and downs, 2025 provided a mixed reception for new cars. Internal-combustion engine (ICE) popularity dropped, the full-hybrid (HEV) sector slowed, and BEVs were polarising. However, the overall picture of 2025 was one of positivity. For the first time since 2020, the market achieved over two million registrations across the 12-month period. In total, 2,020,520 new cars were registered, a 3.5% improvement against 2024. But with challenges continuing, will the country’s new-car momentum continue, and can potential new-car buyers be inspired in the year ahead?  A complex picture While the figures are encouraging, the UK’s automotive industry encountered a number of hurdles last year. Many of these related to electric vehicles (EVs), as the government sought to encourage uptake, while evening the tax balance. The ZEV mandate required 28% of a carmaker’s fleet sold last year to be either battery-electric or hydrogen fuel-cell powered. Having come into effect in 2024, this target increases from 22%. This year, carmakers will need to reach 33%. Earlier in 2025, the UK government made amendments to the mandate, reducing the penalties for missing targets and increasing flexibility. However, it appears this was not enough. BEVs only made up 23.4% of all registrations, revealing the market as a whole was still behind. This was further away than the 2024 result, with a 19.6%. With both years indicating shortcomings, what does this mean for 2026 and the future of the legislation? BEV incentives not helping To help boost BEV uptake, a new incentives programme, the Electric Car Grant, was launched in July, with up to £3,750 (€4,330) being offered against eligible models. However, many options did not meet the requirements for this maximum discount, instead qualifying for the lower £1,500 band. In late August, the Ford Puma Gen-E and Ford E-Tourneo Courier were the first models to make the top grade. Since then, just six other models have met the requirements for the maximum discount. Meanwhile, 38 derivatives now sit in the second band. This includes cars from Volkswagen Group, Kia, Renault Group and Stellantis. The SMMT highlighted that more than 160 BEVs could be purchased at the end of 2025. Therefore, 28.8% of available BEVs were eligible for the Electric Car Grant, and only 5% qualified for the maximum subsidies. This meant manufacturers continued to shoulder the burden of driving up demand, especially to meet the ZEV-mandated target. According to the SMMT, carmakers subsidised BEV sales themselves by more than £5 billion, equivalent to around £11,000 per unit. A future shock? While a push for electrification intensified last year, there were also many mixed messages. In April, BEV models became eligible for vehicle excise duty (VED). This meant that drivers are required to pay £10 for their vehicle’s first year of registration, then £195 a year after. Exemption from the Expensive Car Supplement was scrapped, although the threshold was later raised from £40,000 to £50,000 for BEVs. From the second year of registration, models receive an additional annual tax of £425. This is on top of the standard rate for five years. In the November Budget, plans for a ‘pay-per-mile’ scheme for BEVs and plug-in hybrids (PHEVs) was announced. eVED is set to come into effect in 2028 and will see all-electric models pay 3p per mile, while PHEVs will be charged 1.5p. However, these vehicles will also be paying fuel duty, making their overall rate per mile much higher. From the start of 2026, BEV drivers must also pay London’s congestion charge, from which they were previously exempt. Ban ahead These changes come as the EU is looking to push back its 2035 ban on new petrol and diesel car sales. Its earlier targets could also be more flexible, with banking and borrowing allowed between 2030 and 2032 According to Auto Express, the UK government plans to stick to its plans for a new-car petrol and diesel ban from 2030. Yet, with lacking BEV registrations and tax changes likely to put a strain on demand, further consideration may be needed. ‘Rising EV uptake is an undoubted positive, but the pace is still too slow and the cost to industry too high. Government has stepped in with the Electric Car Grant, but a new EV tax, additional charges for EV drivers in London and costly public charging send mixed signals,’ commented SMMT chief executive Mike Hawes. ‘Given developments abroad, government should bring forward its review and act urgently to deliver a vibrant market, a sustainable industry and an investment proposition that keeps the UK at the forefront of global competition,’ he added. BEV growth misses the mark Despite the rollercoaster of announcements, BEVs ended 2025 with solid growth. In total, 473,348 units were delivered to customers, a rise of 23.9% compared to the same period in 2024. This equated to an increase of 91,378 units, according to Autovista24 calculations of SMMT figures. The 23.4% BEV market share was up by 3.8 percentage points (pp) year on year. However, this indicated below the 28% required of carmakers by the ZEV mandate. Since the first eligible vehicles for the Electric Car Grant were announced in August, this share has increased by just 0.8pp. Yet growth slowed, dropping from 29.5% across the first eight months of 2025 to the 23.9% recorded after 12 months. December saw a registration improvement of 8%, with 47,139 BEVs taking to UK roads in the month. This was enough for a 32.2% market share, up by 1.2pp. This was the second consecutive month of single-digit growth, following a 3.6% rise in November. The monthly results may be skewed by a pull-forward effect from the previous year. Carmakers rushed registrations into 2024, as they sought to meet the ZEV mandate requirement of 22%. With stricter penalties for missing this target, numbers in November and December 2024 may have been inflated. This makes the comparison with this year’s figures imbalanced. Standout performance from PHEVs In terms of volume growth, the best powertrain performance of 2025 came from PHEVs. With a 34.7% rise across the 12-month period, 225,143 units made their way to customers. This was 57,965 more registrations than the whole of 2024. The result meant the powertrain’s market share remained stable from November’s year-to-date result at 11.1%. This was up by 2.5pp year on year. In December, PHEVs proved to be the standout powertrain. Volumes grew by 32.9% in the month, with 16,898 units delivered. This was enough for an 11.6% share of total registrations, up 2.6pp year on year. This growth is especially impressive considering PHEVs are not eligible for the Electric Car Grant. Yet volumes were still some way off from BEV totals. Combining BEVs and PHEVs, the EV market saw growth of 27.2% in 2025, with 698,491 registrations. This gave it a 34.6% share of the market, up 6.5pp. In December, EV deliveries increased by 13.6% to 64,037 units, giving the technology a 43.8% market share. This 3.8pp increase allowed the technology to beat ICE registrations for the first time, albeit by just 0.2pp. However, EVs have closed the gap from a 26.2pp difference since January. Should this continue, the UK will start 2026 with a shift in powertrain dynamics. Hybrid slowdown continues While EVs powered forward in 2025, HEVs saw slower sales growth. Unlike other major European markets, the UK does not combine full and mild-hybrid (MHEVs) models into one category. Instead, MHEVs are included within their respective petrol and diesel markets. At the end of 2025, HEVs represented 13.9% of total registrations across the year. Volumes grew by 7.2%, with 280,185 units taking to UK roads. This performance meant that over the 12 months of the year, HEVs were just 2.8pp ahead of PHEVs in terms of market share. This gap has narrowed slowly across the year, a trend that could continue into 2026. In December, HEVs accounted for 18,430 registrations, up 3% year on year. This gave the powertrain a 12.6% market share, down by 0.1pp compared to the same month in 2024. Adding HEVs to the EV total, the electrified market ended the year with 978,676 registrations, an improvement of 20.7% year on year. Despite a 6.9pp increase, their 48.4% share was not enough to topple ICE. However, in December, electrified deliveries outperformed ICE for the fourth consecutive month, accounting for 56.4% of all registrations. With an 11% jump and 82,467 units leaving dealerships, this sets up the UK market for electrified dominance in 2026. Petrol and diesel struggle again Petrol deliveries were down by 8% across the 12 months, with 937,938 registrations. This was 81,190 units below its tally in 2024. The powertrain still dominated the UK new-car market, with a 46.4% share of deliveries, but this was down by 5.8pp year on year. Diesel’s decline continued, with just 103,906 registrations, a 15.6% fall compared to 2024. In total, 19,198 fewer units were delivered to customers. The technology’s 5.1% market share was down by 1.2pp. In December, petrol registrations fell by 3.1%, with 57,607 units making their way to customers. This was enough for a 39.4% market share, down 2.8pp. There was just 7.2pp between petrol and BEVs in terms of share, the closest the two powertrains have been all year. Yet this may also have more to do with market manipulation in December 2024 than BEVs proving more popular. In that month, carmakers likely held back petrol deliveries to help them meet their BEV targets. This resulted in a 20.9% drop in registrations for the fuel type, their biggest fall since June 2022. Diesel suffered a 12.5% decline in December, with 6,175 deliveries. This was good enough for a 4.2% market share, down 0.8pp. Is ICE dominance over? The ICE market ended 2025 as the dominant force in terms of volumes. In total, 1,041,844 petrol and diesel models were registered, down 8.8% year on year. The group still led the market with a 51.6% share, although this was down by 6.9pp. Yet the ICE market seems to have finally run out of fuel. It was beaten by EVs and electrified models in December. 63,782 UCE units were registered, a 4.1% decline. This gave the powertrain group a 43.6% share, down 3.6pp compared to the same month in 2024. If 2026 begins as 2025 ended, the year will see a shake-up in powertrain dynamics for the UK market. ICE will no longer dominate, with EVs and electrified models out ahead. But with tax changes and confusion over the electrification direction, 2026 may be a rollercoaster for the country’s new-car market.  

The UK’s new-car market continued its shaky 2025 run in November, as the government announced electric vehicle (EV) pay-per-mile plans. But did this hamper battery-electric vehicle (BEV) growth, or did something else play a part? Autovista24 special content editor Phil Curry examines the figures. The UK new-car market saw another monthly volume drop in November, as its rollercoaster ride continued. 151,154 new passenger cars were registered, according to the latest data from the SMMT. This was down 1.6% year on year, marking the sixth monthly volume drop between January and November. After 11 months of 2025, the UK’s new-car market was up 3.4%, with 1,874,271 registrations. The country is likely to see over two million deliveries for the first time since 2019, the SMMT forecasts. Based on available data, December would need to see a 10.7% decline in volumes to miss this milestone. Private car sales fell by 5.5% in November. Combined with 0.2% growth in the volume-leading fleet sector, the new-car market was likely to struggle. Business registrations, which make up a small percentage of overall volumes, increased by 18%. This equated to a rise of just 561 units, however. EVs prop up uneven market Like other major European markets, the UK is seeing registrations of petrol and diesel models decline each month. However, unlike others, the SMMT merges mild-hybrids with their respective petrol and diesel powertrains. This means that reporting of hybrids is based solely on full-hybrid (HEV) models. This provides a more accurate view of the market’s performance. Other countries rely on the full and mild-hybrid figures to boost electrified vehicle growth. But in the UK, mild hybrids help to offset internal-combustion engine (ICE) losses. So, the country’s electrified market consists of models that can run only on electric power for a period of time. However, with lower hybrid figures, the UK relies on EVs, including BEVs and plug-in hybrids (PHEVs), to bolster growth. In recent months, BEV and PHEV deliveries have helped overcome declines in petrol, diesel and HEV figures. All-electric models are the second-most-popular powertrain in the UK at present, while PHEVs have rivalled HEVs in terms of volumes. Yet, this makes the UK’s new-car market very precarious. Should one EV powertrain slow, or falter, it can push the entire market into decline. This is what happened in November. While HEVs had a slow month, so too did BEVs. The all-electric powertrain suffered its lowest growth rate in nearly two years, according to the SMMT. BEV stagnation in November In total, 39,965 BEVs were registered in November. This was a 3.6% year-on-year improvement, equating to an extra 1,384 units. It was the third time in 2025 that the powertrain registered single-digit growth. However, the technology did secure a 26.4% share of the market, its second-highest of the year. This was 1.3 percentage points (pp) more than in November 2024. Yet this was also the lowest improvement of the year so far. Between January and November, 426,209 BEVs were delivered to customers, an improvement of 26%. The technology’s market share sat at 22.7%, a rise of 4pp. The UK’s automotive market will be concerned by this result. This is because the figure is far below the zero-emission vehicle (ZEV) mandate target of 28% for 2025. What caused the BEV result? The slow growth in November came despite the government creating an incentive package in July, aimed at increasing BEV uptake. Clearly, such an improvement did not surface last month. To make matters worse, a recent announcement from the government could hamper EV adoption. This was the announcement that both BEVs and PHEVs would be subject to pay-per-mile tax charges from 2028. November 2025 has come up against a strong period of comparison. At the end of 2024, carmakers were rushing to deliver BEVs. Brands were making a last push to meet the 2024 ZEV mandated target of a 22% market share. November 2024 saw BEV deliveries improve by 58.4%. It was the powertrain’s biggest improvement of the year and was followed by a 56.8% rise in December 2024. Fast forward to today, and some of the financial penalties for missing mandated targets have been relaxed. There is also more flexibility in borrowing against future sales. So, compared to one year ago, carmakers seem less stressed to pull forward BEV deliveries. It is unlikely that the recent announcement in the Autumn Budget impacted November figures. Even if the early media reports broke the pay-per-mile plans three weeks before, many sales would have occurred beforehand. Pay-per-mile problems? The UK market could start to see an impact from the pay-per-mile plans in the coming months. BEVs have seen their financial benefits come under pressure. This year saw the technology become eligible for Vehicle Excise Duty and the Expensive Car Supplement. The BEV market is crucial for the UK to maintain registration growth, yet recent announcements have increased growth uncertainty. ZEV mandate targets are only going to increase, and the ban on new petrol and diesel cars looms. This makes continued BEV adoption vital. ‘Even in a fragile market, ZEV uptake continues to rise, which is exactly what we need,’ commented SMMT chief executive Mike Hawes. ‘But the weakest growth for almost two years, ahead of the government announcing a new tax on EVs, should be seen as a wake-up call that a sustained increase in demand for EVs cannot be taken for granted.’ ‘We should be taking every opportunity to encourage drivers to make the switch, not punishing them for doing so, or else the ambitions of government and industry will be thwarted,’ he continued. PHEVs provide EV boost PHEVs were the UK’s best-performing powertrain in terms of volume growth. In total, 18,005 units were delivered, a rise of 14.8%. This equated to 2,318 more units compared to November 2024. PHEVs secured 11.9% of the market in the month, a rise of 1.7pp. Since April, the technology has consistently held between 11.2% and 12.5% of total monthly registrations, as it pushes to match HEV volumes. In the first 11 months of the year, PHEVs out-grew all other powertrains, with a registration increase of 34.8%. This equated to a total of 208,245 units and an 11.1% market share. The technology has improved its hold by 2.6pp, second only to BEVs when it comes to share growth. Combining BEVs and PHEVs, the EV market reached 57,970 deliveries in November, a 6.8% year-on-year rise. This was the lowest volume increase of 2025. It also marked the first time this year the EV market has seen only a single-digit improvement. Plug-in models controlled 38.4% of the market, up by 3.1pp. After 11 months of 2025, EVs saw an improvement of 28.8%. In total, 634,454 new plug-ins took to UK roads. This was enough for a 33.9% share, up 6.7pp. Rollercoaster 2025 for hybrids The UK’s HEV market is experiencing a rollercoaster year. Apart from the plate-change months of March and September, growth has been in single digits. The technology has also endured four months of decline. November saw the lowest growth of the year, with just 1.3% more HEVs delivered to customers. This equated to a 19,836-unit total, ahead of the same month in 2024 by 245 units. The powertrain took a 13.1% share of the market, up 0.3pp. The UK figures highlight the impact of mild-hybrids on other major European markets. Many of these countries have seen their overall hybrid registrations dominate monthly deliveries. Conversely, the UK’s HEV sector trails petrol and BEV sales. It is also coming under threat from PHEV volumes. Electrified market dominates When hybrid numbers are added to EV figures, the electrified market is leading in the UK. With 77,806 registrations in November, figures were up 5.3% year-on-year. The technology held 51.5% of the market, a dominant position, and a rise of 3.4pp. During the first 11 months of 2025, the electrified market was not as dominant. It still sat behind ICE and is unlikely to overtake it in 2025. In total, 896,209 units were delivered, a 21.7% year-on-year improvement. The powertrain group’s market share sat at 47.8% at the end of November. While this did prove a 7.2pp rise, it was also 4.4pp away from ICE. To finish ahead in the full year, the electrified market has to overcome a deficit of 81,853 units to ICE. In November, the technology registered 4,458 more passenger cars than ICE models. HEVs played their part in the electrified growth this year. From January to November, 261,755 units were delivered, a 7.5% improvement. This gave the technology a 14% share of the market, a 0.6pp rise compared to the same period last year. Petrol remains the leading powertrain Petrol and diesel registrations, including mild-hybrid powertrains, continued to decline in November. The regular drops in unit volume suggest that electrified models will overtake ICE. Should current trends continue, this will likely occur in 2026. Last month, petrol volumes fell by 5.9%, to 66,180 units. This was still enough for a 43.8% market share, a drop of 2pp year-on-year. Meanwhile, diesel struggled again with a 24% decline. The fuel type’s 7,168-unit volume was enough for just 4.7% of the overall market, down from 6.1% a year prior. Between January and November, petrol remained the dominant standalone fuel type, by some margin. Its 47% market share was 24.3pp higher than its nearest competitor, BEVs. Yet this hold was still down on the 53% achieved in the first 11 months of last year. Meanwhile, its cumulative total of 880,331 units represented an 8.3% drop compared to the same period of 2024. Diesel struggles continue Diesel has been left behind at the bottom of the UK new-car market. With 97,731 registrations between January and November, the powertrain will likely only just make it to six figures in 2025. By the end of November, volumes were down 15.8%. Its market share of 5.2% was 1.2pp lower than the same time last year. Combined, the ICE market achieved 73,348 deliveries in November, an 8% year-on-year decline. With 48.5% of the market, it lost its dominance for the third month in succession. Across the first 11 months of 2025, 978,062 ICE models were registered, a 9.1% drop. However, thanks to eight months of dominance between January and August, it still led the market, with a 52.2% share. This was, however, down by 7.2pp. So, the regular dominance of ICE is now at an end. It appears 2026 will start with electrified models leading the annual figures for the first time.