Market Overview - The UK new car market experienced a 7.2% increase in February, reaching 90,100 registrations, marking the highest February volume in 22 years [1] - The month typically sees lower volumes, leading to volatility as many buyers wait for the March numberplate change [1] Demand Drivers - The growth in demand was primarily driven by recovering private retail registrations, which rose by 17.6% to 35,227 units [2] - Fleet registrations increased by 1.8%, while the lower-volume business segment saw a decline of 12.7% [2] - Fleets accounted for 59.4% of new car registrations, remaining the largest source in the market [2] Electric Vehicle Trends - Battery electric vehicle (BEV) registrations increased by 2.8% to 21,840 units, representing 24.2% of the market [3] - However, BEV market share declined for the second consecutive month compared to the previous year, partly due to a strong start in 2025 as buyers aimed to avoid new tax rates [3] - Plug-in hybrids (PHEVs) saw the largest growth, up 43.5% to capture an 11.6% market share, while hybrid electric registrations rose by 3.3% to a 13.1% share [4] Market Dynamics - Petrol demand grew by 5.2%, but its market share decreased to 46.5%, while diesel volumes continued to decline, down 3.8% to just 4.5% of the market [4] - Year-to-date BEV market share stands at 22.0%, which is two-thirds of the 33% target mandated for 2026, making March a critical month for the market [5] Industry Insights - Manufacturers have invested billions in new models and discounts to stimulate demand, supported by the government's Electric Car Grant [5] - The SMMT Chief Executive highlighted the need for a holistic review of the transition to electric vehicles, emphasizing that buyer confidence may weaken due to plans for a pay-per-mile tax for EVs starting in 2028 [6] - The urgency of reviewing the transition is underscored by the impending end of sales for new petrol and diesel cars in less than four years, necessitating rapid acceleration in EV uptake [6]