New car registrations DOWN in January by 2.5% – but EV numbers UP

New car registrations in the UK in January 2025 dropped by 2.5%, but registrations of new electric cars rose by 41.6%.

The last quarter of 2025 saw new car registrations drop as weak demand delivered by an uncertain economy and high interest rates meant new car buyers – especially private buyers – were reluctant to splash out on new wheels. And January 2025 follows the same patch with new car registrations falling by 2.5% – the fourth monthly consecutive drop.

The slight difference in January’s numbers compared to the previous quarter is that the big drop in registrations came from Fleet buyers, with a drop of 3.7% for a market share of 62.4%, and private buyers dropping by a modest 0.5% for a market share of 35.9%.

The main fuel of choice in January was petrol at 50.3% (down 15.3%) followed by BEVs at an impressive 21.3% (up by 41.6%), HEV at 13.2% (up by 2.9%), PHEV at 9.0% (up by 5.5%) and Diesel at 6.2% (down by 7.7%).

The figures for BEV registrations, although stronger but doubtless driven by unsustainable discounts (some £4.5 billion in 2024), are encouraging for advocates of the ICE ban, although even if January’s market share is sustained throughout 2025, it will still fall short of the mandated 28% market share required. In fact, it won’t even reach 2024’s mandated level, and with the ‘Expensive Car Supplement’ being applied to EVs from April private buyers are going to be even more reluctant to go electric.

Mike Hawes, SMMT CEO, said:

January’s figures show EV demand is growing – but not fast enough to deliver on current ambitions. Affordability remains a major barrier to uptake, hence the need for compelling measures to boost demand, and not just from manufacturers. The application, therefore, of the ‘Expensive Car Supplement’ to VED on electric vehicles is the wrong measure at the wrong time. Rather than penalising EV buyers, we should be taking every step to encourage more drivers to make the switch, helping meet government, industry and societal climate change goals.