The UK new car market dropped by 5% in July 2025, with 140,154 vehicles registered. This is the weakest July since 2022, and is nearly 11% below pre-pandemic 2019 levels. According to new figures from the Society of Motor Manufacturers and Traders (SMMT), the drop comes after two months of growth, highlighting the sector’s ongoing volatility.
Private and fleet sales both fell, down 3.2% and 6.5% respectively, while business registrations, though a smaller segment, rose 10.4% to 2,914 units. Only a handful of vehicle types showed growth, namely Dual Purpose, Mini, and Luxury Saloons.
Although the overall drop, plug-in hybrid electric vehicles (PHEVs) continued to gain popularity, up 33.0% year-on-year. Battery electric vehicles (BEVs) also grew by 9.1%, although that does mean BEV registrations are slowing down when compared to the 34.6% growth seen in the first half of the year. It’s the second weakest BEV performance of 2025 so far, following April’s market disruption caused by tax changes.
The newly introduced Electric Car Grant (ECG), which offers up to £3,750 off a new BEV, is seen as a positive step, but with eligibility criteria still not confirmed, some consumers appear to be waiting before purchasing an EV. BEVs accounted for 21.3% of July’s registrations, up from 18.5% in July 2024, but still short of the 28% target set by the government’s ZEV Mandate.
Hybrid electric vehicle (HEV) sales dropped 10% to 18,551 units, while combined petrol and diesel models fell 14.0%. Despite the drop, these still made up over half the market (53%).
So far this year, UK new car registrations are up 2.4%, totalling 1.18 million units, including over 250,000 BEVs. With more EVs entering the market and heavy manufacturer discounting, the SMMT now expects 1.9 million new car registrations for the year, an increased revision, along with a projected BEV market share of 23.8%.
“July’s dip shows yet again the new car market’s sensitivity to external factors, and the pressing need for consumer certainty. Confirming which models qualify for the new EV grant, alongside compelling manufacturer discounts on a huge choice of exciting new vehicles, should send a strong signal to buyers that now is the time to switch. That would mean increased demand for the rest of this year and into next, which is good news for the industry, car buyers and our environmental ambitions.”
Mike Hawes, SMMT Chief Executive
Read more automotive industry news
Leave a Reply
You must be logged in to post a comment.