New car registrations improved by less than 2% in May 2025, although it was a mix of growing fleet business and falling consumer sales, with the overall market still struggling along well below pre-pandemic levels.

According to results published this morning by the Society of Motor Manufacturers and Traders (SMMT), the overall new car market improved by just under 2% compared to the same month last year, thanks to a 4% improvement in fleet registrations. Private new car sales, however, fell by 2%.

This means that for the first five months of this year, the overall market is up by about 3% on last year – with private sales up 5% and fleet sales up 2%.

As has been the case all year, electric and plug-in hybrid cars saw the strongest growth in May 2025, while sales of traditional petrol and diesel cars continued to decline.

EVs and plug-in hybrids still driving growth

EV registrations were up by 26% compared to the same month last year, which resulted in a 22% of the overall market share. Plug-in hybrid sales increased by 51%, resulting in a 12% market share and narrowing the gap with basic (non-plugged) hybrids, which saw 7% growth for a market share of 14%.

The data appears to show that the Expensive Car Supplement (an additional £410/year of road tax on new cars over £40K) being added to EVs from April has not really slowed demand, but we’re only two months into this new tax so we’ll have to keep monitoring this.

The resurgence of plug-in hybrids this year has multiple potential drivers: the government’s ZEV (zero emissions vehicle) mandate allows partial credits for plug-in hybrids, which is helpful for car manufacturers who don’t have many EVs to sell; some market sectors (like large SUVs) still don’t have many EV options, so previous diesel customers are turning to plug-in hybrids instead; and plenty of customers are still reluctant to jump straight from a petrol car into an EV, so a plug-in hybrid is a good halfway house that offers local electric driving with the reassurance of a petrol engine for longer journeys.

Petrol’s market share was again below 50%, as it has been each month since February, as customers progressively move away from purely fossil fuel power to various levels of electrification. However, it must also be noted that some brands are limiting the sales of certain petrol and diesel models to avoid fines from the government’s ZEV mandate.

The ZEV mandate continues to stir debate within the industry. Nominally, EVs have to make up 28% of all new car registrations this year, but after May 2025 we’re currently sitting at 21%. In reality, however, there are various loopholes built into the system, which have been increased recently as the government allows the car industry some more flexibility to shift from fossil fuels to electricity. It’s estimated that the actual target is likely to be about 23%, so we’re not far off. That won’t stop the shouting from both sides of the debate, however.

The Tesla conundrum

One of the question marks about EV registrations every month is always about Tesla’s performance. There has been a lot of noise in recent months about customers being put off Tesla because of their dislike of the company’s CEO, Elon Musk.

In both April and May, Tesla’s registrations in the UK were significantly down, but then Tesla’s registrations tend to fluctuate wildly at the best of times as the company doesn’t operate a traditional dealer network. What we don’t know is whether the April and May results are just part of Tesla’s normal variation that could turn around completely in June, or if this is a genuine indication of a decline in the company’s fortunes as customers turn elsewhere.

If it’s part of the normal variation, and Tesla still has a normal order bank of customers awaiting delivery, we could see a jump in both Tesla and overall EV sales whenever the next boatloads of Tesla Model 3 and Model Y cars arrive from China and Germany. This would give the overall EV market a boost and make the numbers look more positive.

If, however, Tesla is seeing a genuine fall in customer demand, with those consumers and businesses choosing from the many excellent alternatives to the Model 3 and Model Y now available, then it’s bad news for both Tesla and the overall EV market.

We typically review Tesla data quarterly, rather than monthly. At the end of Q1 in March, Tesla registrations were up 6%, just behind the overall market. April and May have been poor, but we’ll have more confidence in the company’s overall direction of travel at the end of June.

Good month, bad month – May 2025

Although the market was up by just under 2%, there were still plenty of ups and downs from the 52 car brands that report their registrations to the SMMT.

It was a good month for Alpine, Bentley, BYD, Cupra, DS Automobiles, Fiat, Ford, Genesis, Ineos, Jeep, Lexus, Maxus, Mazda, Peugeot, Polestar, Renault and Vauxhall. All of these brands outperformed the overall market by at least 10%, which means they saw growth of at least 12% on the same month last year.

Meanwhile, the news wasn’t so good for Abarth, Alfa Romeo, Audi, BMW, Citroën, Dacia, GWM, Honda, KGM, Maserati, Mercedes-Benz, SEAT, Smart, Subaru, Suzuki, Tesla and Volvo. These brands underperformed against the overall market by at least 10%, meaning they experienced declines of at least 8% compared to last May’s data.

That means that the following brands were about where you’d expect them to be: Hyundai, Kia, Land Rover, MG, Mini, Nissan, Porsche, Skoda, Toyota and Volkswagen. This means they were within 10% (plus or minus) of the overall market.

The biggest improver in overall numbers was BYD, which jumped from about 600 cars last May to 3,000 cars this year. It’s still a new brand that has added several models to its range, so that’s not quite as significant as it might seem on the surface. But it certainly shows that BYD is making strides. Omoda and Jaecoo, two new brands that essentially operate as one company, also registered about 3,000 cars in May and didn’t even exist in the UK 12 months ago, which shows the inroads that new Chinese brands are making into the UK market.

Going in the other direction, Audi registrations dropped by about 2,600 units compared to the same month last year, which was a 24% fall. Year-to-date, Audi is down about 18% as some of its best-selling models are replaced. It will be interesting to see if sales recover in the second half of the year.

Volkswagen remains the UK’s best-selling brand, comfortably ahead of BMW in second place, followed by Kia, Ford and Audi.

Ford Puma back on top in battle with Kia Sportage

The Ford Puma edged further ahead in the 2025 sales race, topping the sales charts in May ahead of its main rival, the Kia Sportage. Puma sales will no doubt be helped by the arrival of the new Gen-E electric model and, as we approach the halfway point of the year, the Puma has a lead of exactly 2,300 cars.

It was a good month for Nissan’s UK production in Sunderland, with the Qashqai and Juke models placing third and fourth in May’s results. The Qashqai is about 500 units ahead of the Vauxhall Corsa, which finished fifth in May.

It was another good month for MG, with the ZS small SUV popping up in sixth place in May and moving up to seventh in year-to-date sales. With the larger HS SUV in tenth, MG now has two models in the top ten after five months of the year.

It was the first appearance in the top ten for a long time (possibly ever?) for the Hyundai Kona, with its larger sibling, the Tucson, disappearing from both the monthly and year-to-date best-seller list. And the new Mini Cooper is slowly making inroads, with a second month in tenth place. It’s been a slow burn for the new Mini, after the previous model was one of the UK’s best-selling cars for almost its whole production life.

Several of the top ten models have electric versions (Ford Puma Gen-E, Vauxhall Corsa Electric, Hyundai Kona Electric, Peugeot e-2008, Mini Cooper Electric), but with another slow month from Tesla, there are no dedicated EV models in the top ten.

We’ll have our usual in-depth look at the top ten in the next few days.