The new car market grew for the second consecutive month in June, as registrations rose 6.7% to 191,316 units, according to the Society of Motor Manufacturers and Traders (SMMT).
It was the best June since 2019, helping lift first half performance 3.5% above the same period last year, although the market remained 17.9% behind pre-Covid levels.
Despite a positive June performance, it too remained behind pre-pandemic levels, 14.4% lower than in 2019.
June’s performance was driven mostly by fleet activity, with uptake climbing 8.5% to 114,841 units.
Private retail demand grew 5.9% to 71,616 units, but still accounted for just under four in 10 new cars registered (37.4%) and business registrations fell 15.8% to 4,859 units.
New petrol registrations declined 4.2% and diesel volumes were flat (0.2%), meaning their combined share of the market is now just over half (51.6%), with total electrified vehicle registrations (92,571) achieving a 48.5% market share.
Registrations of vehicles with plugs rose strongly as battery electric vehicles (BEVs) jumped 39.1% to 47,354 units, equivalent to a quarter (24.8%) of the market, and plug-in hybrid electric vehicles (PHEVs) grew 28.8% to 21,382 units.
The market for new hybrid electric vehicles (HEVs), meanwhile, fell by 8.5% to 23,835 registrations.
Across the first six months of 2025 new BEV registrations have risen 34.6% to 224,841 units but, at 21.6% market share, they remain significantly behind the 28% mandated for this year.
Achieving even this level of market penetration has required discounts totalling £6.5bn over the last 18 months.
In a recent survey of automotive CEOs carried out for SMMT’s new Automotive Business Leaders Barometer, more than half (55%) said they believe the UK is significantly behind plan to meet the 2030 end of sale date for new cars powered solely by combustion engines.
A lack of Government purchase and charging incentives, combined with fiscal disincentives such as the newly applied VED Expensive Car Supplement (ECS) – which is estimated to impose an effective fine of more than £360m on BEVs bought from April in this year alone – are acting as a brake on BEV demand.
Industry bosses reaffirmed this, citing fiscal incentives for private BEV sales as the biggest single action needed to boost BEV demand, economic growth and the UK’s automotive manufacturing base – a key objective of Government’s new Industrial Strategy.
The SMMT note that amending the ECS to remove the majority of BEVs from its scope and cutting VAT on new BEVs and public charging would boost demand significantly.
This would also help deliver a vibrant domestic market, becoming a leader not just in decarbonisation but in affordability.
If implemented for three years, an additional 267,000 BEVs – rather than fossil fuel vehicles – would be put on the road, driving down CO2 emissions by six million tonnes a year.
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.”
Reaction:
Nick Williams, managing director, Lex Autolease, part of Lloyds Banking Group:
“It’s an exciting time for the electric vehicle market; technology is moving fast, and drivers now have access to a much broader range of affordable electric models.
“The second-hand EV market is also on the rise, with Tusker’s pre-owned models being taken up within just 10 days on average.
“To keep this momentum going, it’s important that we tackle the common misconceptions that may prevent drivers from making the switch, such as battery durability.
“Today’s EV batteries are built to go the distance and every new car comes with at least an eight-year, 100,000-mile battery warranty.”
Susan Wells, director of EV & Solar at Hive:
“June’s new car registration figures reflect the continued strength of the electric vehicle market, with EV adoption gaining further momentum as drivers increasingly recognise the benefits of making the switch from petrol and diesel.
“The long-term commitment to EV manufacturing announced in the government’s Industrial Strategy is to be welcomed across the industry and will help lay the foundations for mass adoption.
“What’s more, the Climate Change Committee’s latest assessment that more people are buying electric cars than ever before is testament to the industry’s collective hard work to date.
“It’s important to remember there’s still a long way to go make the UK’s EV dream a reality and as more vehicles enter the roads the demand for a robust, cost-effective and accessible charging network becomes vital.”
Jon Lawes, managing director at Novuna Vehicle Solutions:
“The rise in EV registrations is encouraging, but we’re still short of the ZEV mandate’s 28% target – a gap that matters for fleets already under pressure to decarbonise.
“Recent changes to the mandate risk blunting the industry’s momentum just as we need it most.
“Encouragingly, the commercial sector is stepping up, especially in LCVs, where greater model choice and tighter emissions rules are driving uptake.
“But long-term progress will depend on consistent policy and faster infrastructure rollout to give fleet operators the confidence to scale their transition plans.”
