The UK new car market experienced a 10.4% decline in April 2025, with 120,331 units registered, according to the Society of Motor Manufacturers and Traders (SMMT).  

This was the sixth decline in seven months, reflecting a challenging economic environment and reduced consumer confidence. 

According to the trade body, April’s decline was influenced by the late timing of Easter, resulting in fewer working days, and the implementation of Vehicle Excise Duty (VED) changes from 1 April.  

The Expensive Car Supplement, now applicable to many new electric vehicles (EVs), prompted consumers to complete transactions in March to avoid tax increases. 

Registrations declined across every sales category, with private purchases dropping 7.9%, fleet sales decreasing 11.9% and business demand falling 10.9%. 

Fleet buyers accounted for six out of ten registrations.  

Hybrid electric vehicle (HEVs) sales saw a 2.9% decline, while petrol and diesel registrations dropped 22% and 26.2% respectively.  

However, sales of plug-in hybrid vehicles (PHEVs) rose 34.1%, and battery electric vehicles (BEVs) increased 8.1% to 24,558 units, capturing 20.4% of the market. 

The availability of more than 130 BEV models, including more affordable options, reflects manufacturers’ investments in electric options.  

As at May 2025, the new car market is up 3.1%, with BEV registrations rising 35.2%, pushing market share to 20.7%.  

Despite this growth, BEVs remain below the 28% market regulation target. 

SMMT states that government incentives are crucial to boosting EV volumes.  

Suggestions for such incentives include halving VAT on new EV purchases, amending the VED Expensive Car Supplement, and equalising VAT on public charging with home charging to encourage hesitant buyers to switch to electric vehicles. 

SMMT’s latest market outlook forecasts 1.964 million new car registrations for 2025, but expects 2026 to remain below two million – the seventh consecutive year of such figures. 

Market share expectations for new BEV registrations have been slightly revised downward, with 23.5% expected in 2025 and 28% in 2026, compared to the Zero Emission Vehicle Mandate targets of 28% and 33%. 

SMMT chief executive Mike Hawes stated: “April’s performance is disappointing but expected after March’s surge. Another month of growth for electric vehicle registrations is good news, however, even if demand remains well below ambition.  

“Recent government adjustments to flexibilities and compliance within the ZEV [Zero Emission Vehicle] Mandate are welcome and an important first step in relieving some of the pressure on the market and manufacturers.  

“However, EV uptake is still being heavily and unsustainably subsidised by the industry, which is why a compelling package of measures from government is essential if consumers are going to make the switch.”