The UK’s leasing sector recorded modest growth of 0.65% in 2024 despite changeable consumer confidence, with business contract hire (BCH) expanding by 6% and now accounting for the majority of the BVRLA’s leasing fleet.

The market showed divergent trends between segments, with car leasing up 4.9% while van leasing declined by 10.96% year-on-year.

Salary sacrifice schemes have emerged as a particular success story, growing by 61% last year with battery electric vehicles (BEVs) dominating this segment – nearly 9-in-10 additions to salary sacrifice fleets were electric vehicles.

The appetite for EVs was equally strong in BCH agreements, where BEVs accounted for 54% of all new cars added to the BVRLA fleet in Q4 2024.

While business leasing has shown resilience, personal contract hire (PCH) has experienced more challenging conditions, with a 13.4% decrease in vehicles on agreements.

BVRLA members have reported notable increases in contract extensions and delays in customers signing up to new agreements as private customers feel economic fluctuations more keenly than business users.

Toby Poston, BVRLA chief executive, said: “Again we are seeing the adaptability and resilience of the sector. Local and global economic uncertainty is causing many customers to hold fire but there remain pockets of optimism.

“To see the leasing fleet grow in such challenging conditions is positive, but the gaps between segments are widening. It is no surprise to see the segments performing well are where they have suitable support in place.

“Business customers have a greater ability to absorb short-term fluctuations, while also benefiting from targeted government incentives to drive the uptake of electric cars.

“Financial incentives are the biggest lever to alter action and the recent changes to the ZEV Mandate will influence their necessity. Personal customers and van operators desperately need increased attention and we remain committed to making their voices heard where it can make a difference.”