UK car market grows for second year, but EV adoption falls short of targets

The UK car market achieved its second consecutive year of growth in 2024, with 1,952,778 new car registrations, up 2.6% from 2023, according to the Society of Motor Manufacturers and Traders (SMMT). However, concerns remain over electric vehicle (EV) adoption, which fell short of mandated targets despite reaching record levels.

Fleet registrations spearheaded market growth, increasing by 11.8% to 1,163,855 vehicles and comprising nearly 60% of all new registrations. Conversely, private consumer demand declined by 8.7% to 746,276 units, marking levels not seen since the pandemic lockdowns in 2020. Business registrations also contracted slightly, down 3.1% to 42,647 units.

Battery electric vehicles (BEVs) achieved a record annual market share of 19.6%, with 381,970 registrations. This marks a significant increase of over 67,000 units compared to 2023. Yet, this figure fell short of the government’s 22% mandate for zero-emission vehicles (ZEVs), leaving manufacturers under pressure as they attempt to meet stricter targets.

A major barrier to growth in EV adoption has been low demand from private buyers. Only one in 10 private consumers opted for an EV in 2024, with petrol vehicles remaining dominant at 61% of the segment. Hybrid electric vehicles (HEVs) followed at 16%. By contrast, businesses and fleets drove the EV market, with such vehicles making up 25.4% of their registrations, boosted by tax incentives.

Traditional petrol and diesel vehicle registrations fell by 4.4% and 13.6%, respectively, while lower-emission options gained traction. Hybrid electric vehicles grew by 9.6%, and plug-in hybrids saw an 18.3% increase. These shifts contributed to a 6.2% reduction in average new car CO2 emissions, now at 102.1g/km. However, the extent of compliance with future CO2 targets remains uncertain.

The SMMT has welcomed a government review of the ZEV mandate regulation but warns that current market conditions will not support the required 28% EV share in 2025, representing a nearly 50% uplift.

“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.”

The industry is urging action to stimulate private demand and expand the UK’s EV charging network, addressing consumer concerns about affordability and convenience. As the 2025 ZEV mandate looms, stakeholders stress that aligning regulatory ambitions with market realities is critical to sustaining growth and achieving decarbonisation goals.