Fleet growth boosting UK new car outlook as new brands gain share

Fleet activity is expected to remain the driving force behind the UK’s new car market recovery in 2025, according to Cox Automotive’s latest quarterly forecast.

The company predicts new registrations will exceed two million units this year – up 5.7% on 2024 and 29.1% above the 2022 market low – though still nearly 10% below pre-pandemic norms.

The forecast underlines the continuing dominance of fleets in market performance, with business and leasing registrations expected to account for 50% of the total, compared to 47% from private buyers.

The remaining volume is made up by rental and other channels.

New market entrants critical to market growth

New market entrants – particularly brands from China – are emerging as a critical factor in the market’s upward trajectory, with several gaining traction in fleet channels and influencing purchasing behaviour.

BYD, Jaecoo and Omoda - all of which are appearing at next week's Company Car in Action (June 11-12), are among the brands reshaping brand choice and supply strategies.

BYD alone achieved 631% year-on-year growth between January and April 2025, now holding 1.68% market share.

Philip Nothard, insight director at Cox Automotive Europe, said: “Breaking the two million mark in 2025 would be a key milestone for the UK’s automotive recovery.

“But for fleets and the wider industry, the real challenge is adapting to a changing competitive landscape – one that demands more flexible sourcing, logistics and manufacturer relationships.”

Nothard warned that growing reliance on non-European supply and emerging product standards will require fleets and procurement managers to rethink current practices, especially as legacy OEMs adjust to stiffer competition.

EV adoption grows, but long-term concerns remain

Electric vehicle (EV) registrations hit record levels in Q1 2025, but Cox Automotive warns this may not reflect underlying, sustainable demand.

The UK is still projected to fall short of the 2025 Zero Emission Vehicle (ZEV) mandate, ending the year with 24% EV registrations – four percentage points below the 28% target.

The gap is forecast to widen by 2028, with a 16% shortfall in the ZEV mandate expected if current trends continue.

Nothard added: “While the ZEV mandate has been softened to reduce penalties, this alone won’t fix the structural issues affecting EV uptake.

"Fleets in particular face uncertainty around taxation, charging infrastructure, and total cost of ownership – all of which are critical to long-term planning.”

Market pressures remain despite improving outlook

While headline forecasts point to a recovering market, Cox Automotive cautions that broader challenges persist.

Global supply chain issues, tariff risks, and inconsistent consumer demand continue to cloud the outlook – especially for fleets with multi-brand, cross-border operations.

The full Q1 2025 Insight Quarterly from Cox Automotive as available to read in full now.