UK new car registrations soared last month in a welcome return to growth that also marked a new high for EV demand.

Battery electric car uptake rose to its highest-ever volume at 69,313 units but the 19.4% market share is still below the ZEV mandate target for 2025

The arrival of the new ’25 registration plate drove registrations 12.4% higher in March to 357,103 units, according to the latest figures from the Society of Motor Manufacturers and Traders (SMMT).

The fleet sector reversed the February fall with an 11.5% rise, giving a 56.6% market share (vs 57.1% in March 2024) while private registrations continued to rise with a 14.5% uplift that took market share to 41.2% (40.4% in March 2024). However, ‘Business’ registrations to fleets with fewer than 25 vehicles were down a marginal 0.3%.

This growth, in the most important month of the year for the new car market, builds on the March 2024 performance, where uptake rose by 10.4%. As a result, this year’s ‘new plate’ month represents the best March performance since 2019.

Battery electric vehicles (BEVs) were the star of the show, up a massive 43.2% to 69,313 units; the highest-ever volume. This was aided by manufacturers incentivising uptake with significant discounting to comply with the ZEV mandate. As a result, March became the largest month ever for registrations of electric cars, which also took a record 19.4% market share (15.2% in March 2024).

Hybrid electric vehicles (HEVs) were up 27.7%, with plug-in hybrids (PHEVs) rising 37.9%. Meanwhile, diesel fell 10.1% to 20,967 units and petrol dropped 0.4% to 176,847 units.

But while EV market share improved significantly on March 2024, at 19.4% it remains more than eight percentage points behind the 28% target for 2025 set by the ZEV Mandate.

And with new EVs facing increased VED costs from 1 April – including the Expensive Car Supplement from 1 April, potentially raising ownership costs for most EV drivers by more than £2,000 over the next six years – the SMMT says the March EV performance will have been boosted by shrewd buyers seeking to get ahead of the tax rise.

Year to date, BEV uptake comprises 20.7% of the market, up on 15.5% for the first quarter of 2024 but highlighting the importance of government incentives and mandatory targets for charge point rollout to stimulate EV demand, according to the SMMT.

The auto trade body warned that last week’s Spring Statement was a missed opportunity to intervene, and has reiterated calls for accelerated regulatory review, following the recent ZEV mandate consultation, and government incentives.

Mike Hawes, SMMT chief executive, said: “Without substantive government support for consumers, the current regulatory regime is undeliverable. A rapid response to the government consultation is therefore needed – one that adds flexibilities that reflect the natural level of demand and supports the industry to deliver growth in the face of a tough set of global challenges.”

Current tax policy is ‘deterrent to EV adoption’

Novuna Vehicle Solutions concurred with the carmakers’ view, saying the Chancellor’s Spring Statement was a missed opportunity to accelerate adoption and maintain impetus in the electric vehicle market.

Many pundits said the Spring Statement was a missed opportunity to accelerate EV adoption

Jon Lawes, managing director, went on: “The Government’s lack of decisive fiscal reform risks stalling the UK’s transition at a critical moment for the market.

“Despite a surge in availability of more affordable electric models – particularly from Chinese manufacturers – which is driving greater consumer choice and shaking up the market, current tax policy is a deterrent to adoption.

“With impending US tariffs sending shockwaves through the UK automotive sector which is already still in limbo awaiting clarity on the Zero Emission Vehicle (ZEV) mandate consultation, we need urgent action and revised targets to restore momentum. Without intervention, the UK risks putting the brakes on progress at precisely the moment it needs acceleration.”

The National Franchised Dealers Association (NFDA) also said last week’s Spring Statement missed an opportunity in accelerating the electrification of the UK car parc – and also called for action following yesterday’s announcement of a 25% tariff on cars entering the US.

Sue Robinson, chief executive of the NFDA, said it was crucial that the Government acts quickly and decisively to safeguard jobs and protect the industry.

Deloitte’s Jamie Hamilton, automotive partner and head of electric vehicles, commented: “The industry needs clarity if the transition to electric is going to continue at pace.

“However, recent developments on the Industrial Strategy, with its commitment to substantial investment – including hundreds of millions of pounds earmarked for expanding semiconductor production in Wales – is a very positive step. This dedication to nurturing a resilient and globally competitive EV supply chain here in the UK, is exactly the type of initiative that will propel growth and solidify the country’s position in sustainable mobility.”

Finally, on the subject of tariffs, Philipp Sayler von Amende – chief commercial officer, Get Your Car, said: “We don’t yet know the impact that President Trump’s new 25% tariffs on vehicle might have on the UK motor retail sector. It could drive a renewed focus on European production, marketing and sales efforts – increasing competition and potentially lowering prices in the region.

“The Government must ensure that the UK remains a competitive and attractive market for automotive innovation and growth. It is clear that manufacturers need the confidence to invest, car dealers need access to new and used stock, and consumers will continue to expect choice at a range of prices.”