Electric vehicle sales forecast suggests Government target missed again

Sales of battery electric vehicles (BEVs) will increase to 440,000 in 2025, but will again fall short of the Government’s zero-emission target, new analysis suggests.  

BEVs made up 19.6% of the market (381,970 units) in 2024, while the zero emission vehicle (ZEV) mandate had targeted a 22% market share.

This year, Government has mandated that more than a quarter of (28%) new car registrations must be zero emission. 

With leasing company DriveElectric forecasting 1.84 million total new car sales in 2025, it says that BEV registrations of 440,000 would represent 24% of the market. 

The latest figures from the Society of Motor Manufacturers and Traders (SMMT) showed that, thanks to incentives such as low benefit-in-kind (BIK) tax rates, the fleet market is behind the majority of electric vehicle (EV) registrations, with only one in 10 private buyers choosing an EV in 2024. 

However, DriveElectric says that there are currently no similar measures such as grants for private motorists, which will continue to hold back retail EV sales.

DriveElectric’s forecast for 1.84 million overall car sales in the UK in 2025 is slightly lower than some other industry figures, because it is expected that some manufacturers will reduce sales of petrol and diesel cars in an effort to meet the ZEV mandate targets – a development that was already evident in 2024. 

Adam Kemp, partnerships director at DriveElectric, said: “We are forecasting that electric car sales in 2025 will experience an increase of just over 4% compared to 2024 figures, taking them to 24% of the total new car market, which is significant progress, but this still falls short of the 2025 ZEV mandate target of 28%. 

“A key factor in the shortfall is that while businesses and fleets enjoy financial incentives to make the switch to electric cars, and although EVs have lower whole life costs than petrol and diesel cars, there are currently no incentives for private motorists to purchase new EVs.”

No car manufacturer is expected to pay fines to the Government for missing the ZEV mandate sales target. 

Manufacturers that fall short of the targets face fines of £15,000 for every internal combustion engine (ICE) car sold above the quota and £9,000 for every van. Fines for non-compliant vans are set to double from £9,000 to £18,000 in 2025. 

The ZEV mandate, however, features a range of flexibilities to help industry comply in a way that makes sense for them and the wider market, including selling fewer zero emission vehicles than the headline target if they make up for it in other ways. 

After the targets were widely criticised by manufacturers, the Government launched a fast track consultation to finalise its plans to end the sale of new petrol and diesel cars by 2030, which includes updates to the ZEV mandate.

The Department for Transport (DfT) consultation closes on February 18.

DriveElectric uses its own model built from its intelligence of the UK market to forecast registrations of battery electric cars and vans each year. 

In January 2024, DriveElectric accurately predicted that the percentage of EV sales for 2024 would be closer to 19% of the total market in 2024.