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EV & Sustainability

Fleet sector powers new car market recovery as EV challenge grows – SMMT

Fleets accounted for nearly 60% of the entire new car market in June.

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The UK’s new car market recorded its second straight month of growth in June, with fleet operators continuing to play a leading role in the industry’s recovery.

Registrations rose 6.7% year on year to 191,316 units, according to the Society of Motor Manufacturers and Traders (SMMT), making it the strongest June performance since 2019.

The uplift helped push the market’s first-half total 3.5% ahead of the same period in 2024. However, overall volumes remain well below pre-Covid levels, with June down 14.4% on 2019 and the year-to-date market still trailing by 17.9%.

Fleet registrations were once again the key driver, climbing 8.5% to 114,841 units.

By contrast, private retail demand increased by 5.9% to 71,616 units, while business registrations fell 15.8% to 4,859 units.

Fleets accounted for nearly 60% of the entire new car market in June.

Electrified vehicles continued to gain ground, with plug-in models making particularly strong progress.

Battery electric vehicle (BEV) registrations jumped 39.1% to 47,354 units, securing a 24.8% market share, while plug-in hybrid electric vehicles (PHEVs) grew 28.8% to 21,382 units.

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Combined, vehicles with a plug represented more than a third of the fleet market.

However, hybrid electric vehicle (HEV) registrations declined by 8.5% to 23,835, and new petrol car registrations slipped 4.2%, while diesel volumes were flat, edging up by just 0.2%.

Petrol and diesel models together now account for 51.6% of all new cars registered.

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Despite the growth, BEVs trailed behind the mandated target of 28% market share for 2025, with the year-to-date share sitting at 21.6%.

A total of 224,841 new BEVs were registered in the first six months of the year, up 34.6% on the same period in 2024.

This progress has come at a cost, with manufacturers offering £6.5bn in discounts over the past 18 months to stimulate demand.

In a recent SMMT survey of automotive CEOs, more than half (55%) said they believe the UK is significantly behind schedule in its aim to end the sale of new combustion-engine cars by 2030.

Concerns were raised about the lack of Government support for BEV uptake, particularly among private buyers, and the negative impact of policies such as the Expensive Car Supplement (ECS), which is expected to impose a £360m tax burden on BEVs purchased from April this year alone.

Industry leaders stressed that targeted fiscal incentives would not only accelerate BEV adoption but also boost economic growth and support the UK’s manufacturing ambitions.

SMMT said that removing the ECS for most BEVs and cutting VAT on new electric cars and public charging could deliver a major boost to the market.

If adopted for three years, such measures could help put an additional 267,000 BEVs on the road, cutting CO₂ emissions by six million tonnes annually.

Mike Hawes, SMMT chief executive, said: “A second consecutive month of growth for the new car market is good news, as is the positive performance of EVs.

“That EV growth, however, is still being driven by substantial industry support with manufacturers using every channel and unsustainable discounting to drive activity, yet it remains below mandated levels.

“As we have seen in other countries, government incentives can supercharge the market transition, without which the climate change ambitions we all share will be under threat.”

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