UK New Car Sales: May 2025

May saw the UK new‑car market edge back into growth, with 150,070 registrations—a rise of 1.6 % year‑on‑year, marking the strongest May since 2021. But beneath the numbers lies a nuanced tale: fleet growth, private buyer hesitation, and an accelerating shift to EVs.

Who's Buying New Cars?

Fleet & business users accounted for 62.6 % of total registrations. Fleet registrations climbed 3.7 %, business up 14.4 %, making them the primary sector for this growth.

Private buyers - so everyday consumers, continued to lose interest — new car registrations dropped 2.3 %, marking a second straight month of decline.

Electrification Surges Ahead

Electric Vehicles—battery, plug‑in and hybrids—claimed 47.3 % of all new-car registrations:

• BEVs (full battery EVs) saw registrations jump 25.8 %, capturing 21.8 % of the market
• PHEVs (plug‑in hybrids) experienced a striking +50.8 % surge
• HEVs (hybrids) rose more modestly by +6.8 %

Despite this, year‑to‑date BEV share sits at 20.9 %, trailing the 28 % Zero‑Emission Vehicle (ZEV) mandate target — revealing a gap that government and industry still need to close.

Why the dip for Petrol & Diesel car sales?

Usual combustion engine vehicles lagged well behind:

• Petrol registrations fell 12.5 %
• Diesel declined a sharper 15.5 %

Incentives to drive EV sales

This sector rebound hinges heavily on manufacturer discounting, especially for EVs. While incentives helped lift BEV registrations, SMMT boss Mike Hawes warned that such tactics aren't sustainable and risk undermining long‑term investment and innovation

What do May's results mean?

Market recovery is happening—but it's fragile. May’s growth is modest and heavily fleet‑driven.

EV adoption is accelerating, now almost half the market; yet this remains incentive‑driven rather than demand‑driven.

Private buyers are stepping back, perhaps due to economic pressures or confusing policy signals.

Policy remains key: sustaining momentum depends on smarter fiscal mechanisms and clarity around ZEV targets.

If you have bought a new car in May, don't forget to read up about GAP insurance and get a quote with us for quality coverage for forward thinkers.