The latest figures from The Society of Motor Manufacturers & Traders (SMMT) have revealed that UK new car sales saw a slight increase in October, rising by 0.5% compared to the same period last year.

The cumulative number of zero emission vehicles (ZEVs) registered so far this year has already overtaken the total figure recorded in 2024, with two months still remaining in the calendar year.

Industry forecasts suggest that total new car registrations could surpass two million units this year, a milestone not reached since 2019.

However, this outlook faces uncertainty amid proposals to scrap Employee Car Ownership Schemes (ECOS) and introduce pay-per-mile road taxation.

ECOS currently supports around 100,000 new vehicle registrations annually, representing approximately 5% of the overall market.

Many of these are low-emission or zero-emission models. SMMT analysis indicates that removing ECOS would likely affect sales of both new and nearly new vehicles and could result in financial losses for the automotive sector of approximately £1bn.

The group warns that such a move could hamper investment prospects and pose risks to manufacturing jobs across the UK.

According to the SMMT, eliminating ECOS could also have negative implications for public finances. Lost revenue from VAT and Vehicle Excise Duty is estimated at around half a billion pounds.

Concerns are heightened by reports of potential pay-per-mile taxation for electric vehicles, which the SMMT describes as “entirely the wrong measure at the wrong time”, warning it could undermine efforts to meet challenging ZEV Mandate targets.

As the government prepares its upcoming Autumn Budget, industry groups are calling for policy decisions that support long-term growth and stability in automotive manufacturing.