UK electric car sales will reach 440,000 in 2025 — falling short of government targets, according to EV leasing company DriveElectric.
The projected sales represent 24% of all new UK car sales, missing the government’s 28% Zero Emission Vehicle (ZEV) mandate requirement.
DriveElectric forecasts total UK car sales of 1.84 million in 2025, with EV sales increasing from 381,970 in 2024.
The company cites several factors driving EV growth:
– Expansion of rapid and ultra-rapid charging networks
– Decreasing battery costs
– New EVs reaching price parity with gas vehicles
– Improved driving range in new models
Recent EV releases like the updated Skoda Enyaq and Audi A6 e-tron offer approximately 400-mile ranges, addressing previous range anxiety concerns.
Business fleet adoption continues to lead EV growth, driven by favorable Benefit In Kind (BIK) tax rates. BIK rates will remain at 2% until April 2025, then increase 1% annually to 5% by April 2028.
“While businesses and fleets enjoy financial incentives to make the switch to electric cars, there are currently no incentives for private motorists to purchase new EVs,” says Adam Kemp, DriveElectric’s partnership director.
Salary sacrifice schemes through employers can reduce monthly EV costs by up to 40% for workers.
The auto industry continues pushing for private buyer incentives, including:
– Temporary VAT reductions
– Reconsidering luxury car tax application to EVs
– New grant programs
The UK met its reduced 19% ZEV target in 2024, down from the original 22% requirement. However, without new private buyer support, reaching 2025’s 28% goal appears unlikely.
Companies face increasing pressure to electrify their fleets to meet carbon reduction reporting requirements and maintain competitiveness in contract bidding.
