Disaster for Labour as it falls way short of EV sales target despite huge discounts on car
Manufacturers offered £5.5 billion in discounts – equivalent to more than £11,000 per EV sold.
An electric vehicle charging in London (Image: Getty)
Britain’s electric vehicle push suffered a major setback in 2025, with sales missing the Labour Government’s key target by a wide margin even as manufacturers poured billions into discounts to shift stock. Battery electric vehicles (BEVs) captured just 23.4% of the market, with 473,340 registrations, according to preliminary data from the Society of Motor Manufacturers and Traders (SMMT), which is well below the headline 28% Zero Emission Vehicle (ZEV) mandate for the year.
Total new car registrations reached 2,020,373, up 3.5% from 2024 and surpassing two million for the first time since the pandemic, but industry leaders warned that the EV shortfall came at an intolerable cost. Decarbonisation minister Keir Mather insisted a £7.5 billion Government investment was “driving EV uptake” and vowed to maintain momentum through grants and more public chargers.
Electric bicycles on sale in China (Image: Getty)
However, Mike Hawes, SMMT chief executive, said: “The new car market finally reaching two million registrations for the first time this decade is a reasonably solid result amid tough economic and geopolitical headwinds.”
Mr Hawes added: “Rising EV uptake is an undoubted positive, but the pace is still too slow and the cost to industry too high.”
He revealed manufacturers offered £5.5 billion in discounts – equivalent to more than £11,000 per EV sold – describing it as “unsustainable”.
Mr Hawes said: “This is increasing the number of battery electric vehicles being sold. The question is, at what cost?”
He called for the Government to advance a planned 2027 review of the ZEV mandate, highlighting “mixed messaging” such as the reintroduction of the electric car grant of up to £3,750 alongside the November Budget announcement of a future pay-per-mile tax for EVs.
Electric vehicles are longer exempt from London’s congestion charge (Image: Getty)
Mr Hawes warned: “Even the announcement of a tax specifically on EVs will send a very conflicting message to consumers.”
Eurig Druce, UK group managing director for Stellantis (owner of Vauxhall, Peugeot and Citroen), told the BBC the UK was “increasingly out of step with the position in Europe and the rest of the world”.
Mr Druce urged an early review this year to give manufacturers “certainty” for investment decisions. The mandate allows flexibilities, including credits for lower-emission petrol/diesel sales, reducing the effective requirement to an estimated 20.4%, which the industry met and avoided widespread fines.
Petrol’s share fell to 46.4% from 52.2%, diesel to 5.1% from 6.3%, while non-plug-in hybrids rose slightly to 13.9%. Chinese brands experienced significant growth, capturing 9.7% of the market with 196,000 vehicles.
Top sellers were the Ford Puma and Kia Sportage overall, with Tesla’s Model Y leading BEVs.
Colin Walker of the Energy and Climate Intelligence Unit called 2025 “another bumper year for EV sales”, predicting benefits for the second-hand market.
Tanya Sinclair, chief executive of Electric Vehicles UK, said EVs offered “strong value for money” and “best-in-class performance”, but demanded “clearer, more consistent policy signals”.
Ginny Buckley, chief executive of Electrifying.com, said: “Education will unlock the next wave of EV buyers, not uncertainty.” With the 2026 target rising to 33%, pressure mounts on Labour to resolve conflicting policies or risk stalling its 2030 ban on new petrol/diesel sales.
