The new car market rose 2.6% in 2024 while EV uptake surged thanks to record fleet uptake.

Battery electric cars saw a record annual volume and market share at 19.6%

New car registrations reached 1.953 million last year, up nearly 50,000 on 2023, while battery electric cars (BEVs) took a record annual volume and market share at 19.6%. The full-year growth follows a flat December that saw 140,786 units registered, marking a marginal 0.2% decline, according to the latest SMMT figures.

Full-year growth was entirely driven by fleets; up 11.8% to reach 1,163,855 units, accounting for a record six in 10 (59.6%) new car registrations. Conversely, registrations by private buyers fell by 8.7% to 746,276 units and a 38.5% share. Demand from the smaller ‘Business’ sector – fleets with fewer than 25 vehicles – fell by 3.1% to 42,647 units.

Electric vehicle demand soared but was again driven by fleets. In the first year of mandated targets for new-zero emission vehicles, BEVs made up 19.6% of the market (381,970 units), up by more than a fifth (67,283 units) from last year when the market had a 16.5% share. The new car market target for 2024 under the ZEV mandate was 22% of all new cars sold although vehicle makers can also comply with the mandate by reducing CO2 emissions from petrol and diesel sales and using ‘flexibilities’ in the scheme.

The full-year rise in BEVs follows another strong monthly performance, with 43,656 new BEV registrations in December, accounting for 31.0% of the market – the highest since December 2022’s record 32.9%.

BEV growth across 2024 was driven by fleets; around 64,000 more BEVs were registered by businesses and fleets than a year ago, with such vehicles representing a quarter (25.4%) of those segments’ registrations.

But private buyer demand for BEVs remains “lacklustre”, with only one in 10 choosing an EV in 2024.

Across the total market, pure petrol and diesel car registrations fell by 4.4% and 13.6% respectively as more buyers swapped either to BEVs, or to lower emission hybrid electric vehicles (up 9.6% and with a 13.4% market share)) and plug-in hybrids (up 18.3% to an 8.6% share).

Consequently, average new car CO2 has fallen by 6.2% to 102.1g/km. This will help some manufacturers with ZEV mandate compliance, although the SMMT said confirmed baseline CO2 figures need to be provided by government. It’s also warned that meeting the mandate thresholds in 2025 will be even more intense as the target is now 28% – requiring an EV market uplift of just under 50%.

Mike Hawes, SMMT chief executive, said: “A record year for EV registrations underscores vehicle manufacturers’ unswerving commitment to a decarbonised new car market, with more choice, better range and increased affordability than ever before. This has come at huge cost, however, with the billions invested in new models being supplemented by generous incentives which are unsustainable.

“We need rapid results from the regulatory review and urgent substantive support for consumers – else automotive investments will be at risk and the jobs, economic growth and net zero ambitions we all share in jeopardy.”

A Department for Transport spokesperson said: “Thanks to the flexibilities in the ZEV mandate, we’re confident the whole market has complied with the 22% target and that no car manufacturer will need to pay fines.

“We’ve invested over £2.3bn to support industry and consumers make the switch, rolled out more than 72,000 public chargers, and launched a consultation to invite the sector to shape how we achieve the transition to ZEVs.

“Getting this transition right as more people make a switch to electric vehicles will support the growth of the UK market and will provide an opportunity to tap into a multibillion-pound industry that will create high-paid jobs for decades to come.”

Industry reaction

Nick Williams, managing director at Lex Autolease

“While challenges persist, there is a quiet confidence that 2025 will see the sector successfully continue to help the country in its transition to a more sustainable future.

“Carmakers know they need to continue to invest in electric vehicles to attract consumers, which is important to the industry’s future success as the shift towards electrification continues to accelerate. A raft of new models coming to market and the continued growth of the second-hand market will help, but so too will investment in nascent technologies and the country’s charging infrastructure.”

Philip Nothard, insight director, Cox Automotive

“The final update for new car registrations in 2024 reflects consistent trends throughout the year. Fleet purchases drove the market while private purchases waned.

“However, it is encouraging to see full-year battery electric vehicle sales accounting for 20% of new cars on the road. Albeit shy of the 22% goal, this consistent growth is promising for the year ahead.

“The industry’s primary focus should now be laser-focused on economic growth, recovery and working closely with the Government to make meaningful, achievable steps towards zero-emission vehicle adoption.”

Jamie Hamilton, automotive partner and head of electric vehicles at Deloitte

“Whilst the industry has invested heavily in electric vehicles, a successful transition requires a supportive policy environment. This includes not just providing clarity on 2030 targets, but also providing incentives to encourage adoption and addressing critical issues such as expanding and developing charging infrastructure. The next 12 months will be crucial for the sector as it navigates these challenges and opportunities.”

Jon Lawes, managing director at Novuna Vehicle Solutions

“An uptick in EV growth in December reflects the significant discounting by manufacturers to reach EV vehicle quotas. However, it remains clear that such incentives are unsustainable with the ZEV mandate unfit for purpose, and the challenges will only get worse with rising thresholds this year.

“There’s no doubt that the industry widely maintains support for the transition, but the Government must act now to relieve pressure on manufacturers that are already stretched to hit overly ambitious targets by providing bold fiscal support over and beyond measures just for company car drivers. Any misalignments with the 2030 ICE phase-out timeline must also be ironed out urgently with a swift conclusion to the consultation – the status quo threatens to stifle the transition to zero emissions vehicles in the year ahead.”

James Court, public policy director at Octopus Electric Vehicles

“Unsurprisingly this is yet another strong set of sales figures for EVs. The ZEV mandate is clearly working – even with the negativity being pushed by pockets of the industry.

“We need a swift conclusion to the uncertainty around the ZEV mandate and refocus efforts of industry and government to make this transition a success, for everyone. A story that cleans up our transport system and ensures jobs for years to come.”

Vicky Read, CEO of ChargeUK

“A fifth consecutive month and another year of growth for electric vehicles shows once again there is strong and growing demand and that the future is electric.

“It’s also been a year of growth for the EV charging sector, with over 73,000 public chargers currently in place and thousands more being installed every month ready to support these vehicles.

“To ensure our members can continue to invest in the chargers, it’s essential we have a strong and stable policy framework.

“We look forward to engaging in the Government’s ongoing consultation and continue to urge policy makers to hold their nerve regarding ZEV mandate sales targets.”