UK car market up but sees EV share fall in January

Market Overview - The UK new car market grew by 3.4% in January, reaching 144,127 units, with growth across all buyer types [1] - Private retail buyers saw a 4.5% increase in registrations, while fleet registrations increased by 1.6%, and the low-volume business segment rose significantly by 46.5% [1] Electric Vehicle (EV) Performance - Battery electric vehicle (BEV) uptake rose by only 0.1% to 29,654 units, resulting in a 20.6% market share, the lowest since April 2025 [2] - The decline in BEV market share follows a strong performance in January 2025, influenced by buyers' attempts to avoid new tax rates on BEVs [2] - BEV sales are falling short of mandated targets under the UK government's Zero Emission Vehicle Mandate, with a target of 33% market share for 2026, compared to last year's target of 28% which was missed at 23.4% [3] Growth in Electrified Vehicles - Plug-in hybrids (PHEVs) recorded the largest growth, increasing by 47.3% to account for 12.9% of registrations [4] - Hybrid electric vehicles also saw a 4.8% increase, making up 13.4% of the market [4] Industry Insights - The SMMT Chief Executive noted that the UK car market is regaining momentum after a challenging start to the decade and is decarbonizing rapidly [5] - Despite a dip in EV market share in January, there are indications of growth by the end of the year, although the pace of transition may be slowing and is behind mandated targets [5] - A comprehensive review of the transition is necessary to align ambition with reality, especially with plans to end sales of new petrol and diesel cars in less than four years [5]