Prime Highlights:
- Total new car sales in the UK surpassed 2 million for the first time since 2019, led by the rising popularity of Chinese brands.
- Electric vehicle sales reached a record 473,000, making up 23.4% of the market and helping cut average car emissions by 10%.
Key Facts:
- Chinese automakers, including MG, BYD, and Chery, captured 9.7% of the UK market, nearly double their share from 2024.
- Sales of plug-in hybrid vehicles (PHEVs) grew by a third, reflecting growing consumer interest in alternative powertrains.
Background:
New car registrations in the UK climbed above two million in 2025 for the first time since before the pandemic, driven largely by a sharp rise in sales of Chinese-made vehicles and growing demand for electric cars, according to industry figures.
Electric vehicle (EV) sales also reached a new high. Battery electric car registrations rose by almost 25% year on year to 473,000 units, representing 23.4% of total car sales. This surge helped cut average emissions from new cars by about 10% compared with the previous year.
Mike Hawes, chief executive of the SMMT, described the overall performance as “a reasonably solid result” despite ongoing economic pressures and geopolitical uncertainty. He noted that the industry continues to face the dual challenge of subdued consumer demand and the costly transition away from petrol and diesel vehicles.
Chinese manufacturers have expanded rapidly in the UK market, which has not imposed import tariffs on vehicles from China, unlike the US and the European Union. MG remained the leading Chinese brand with around 85,000 sales, while BYD recorded a sixfold increase to about 51,000 vehicles. Chery, which operates the Omoda and Jaecoo brands, saw sales jump more than thirteenfold to roughly 54,000 units.
Hawes said carmakers are offering heavy incentives to encourage electric car purchases, with average discounts estimated at around £11,000 per vehicle, amounting to a total cost of £5.5bn across the industry. He called on the government to bring forward its planned review of the ZEV mandate, currently scheduled for 2027.
As a result, PHEV registrations rose by around a third last year, reflecting manufacturers’ preference for models that offer higher profit margins.
The Energy and Climate Intelligence Unit said these flexibilities likely enabled the industry to avoid fines for a second consecutive year, estimating that manufacturers needed electric vehicles to make up just over 20% of sales to stay within the rules.
Looking ahead, uncertainty remains over future EV demand. The SMMT said it is too early to assess the impact of the government’s planned “pay-per-mile” charge for electric cars, announced in November and due to be introduced in 2028.
