Topic: Electric Vehicles

The UK saw a small improvement in new-car registrations in October. How could potential government taxation changes challenge this growth? Autovista24 special content editor Phil Curry examines the market.

The UK’s new-car market remained stable in October, with a small 0.5% rise in deliveries. According to the latest data from the SMMT, 144,948 passenger cars were registered in the month. This was just 660 units more than in October 2024.

While the numbers are comparable, the powertrain split has changed dramatically in the last 12 months. Internal-combustion engine (ICE) models are no longer the dominant force in the monthly figures.

Electrified models, including full hybrids (HEVs), plug-in hybrids (PHEVs) and battery-electric vehicles (BEVs), led for the second month in succession.

Across the first 10 months of 2025, UK registrations were up 3.9% with 1,723,120 deliveries. This has been helped by the strong performances in the plate-change months of March and September. These months helped counter five months of declines across the year so far.

The SMMT’s quarterly industry outlook suggests new-car registrations will top two million units for the first time since the pre-COVID-19 pandemic period of 2019. This year is forecast to reach 2.01 million, while the country is expected to see 2.03 million deliveries next year.

Employee Car Ownership challenge

The UK’s new-car market looks set to beat figures from 2019 for the first time since the pandemic. However, there are looming threats that could scupper further recovery in the coming years.

The ending of Employee Car Ownership Schemes (ECOS) is one such challenge. Operated by manufacturers and dealers, these allow employees to buy new cars at reduced prices. This enabled lower monthly repayments and at a low rate of interest.

The Autumn Budget of 2024 laid out plans to end ECOS by April 2026. However, this date has now been pushed back to October 2026. These vehicles will now be categorised as company cars and taxable benefits.

According to the government, this will add £275 million (€312 million) to the exchequer between 2026 and 2027. It states that an estimated 76,000 individuals will become liable for the income tax associated with the benefit in kind (BIK).

‘These individuals may now need to pay the appropriate benefit-in-kind charge or seek an alternative arrangement with their employer. Impacted employees may choose to retain the current vehicle through a normal car scheme, choose a lower-emitting (lower tax) vehicle or choose to go without a company car altogether,’ the government stated.

Revenue lost

The SMMT argues that plans to end ECOS will impact the UK’s automotive market. It could prevent employees from accessing cars at a more affordable price point, while also challenging electric vehicle (EV) adoption. As these cars are expensive, ECOS puts them within reach of many industry workers.

‘With around 100,000 cars supplied via ECOS a year – equivalent to around 5% of the annual new car market – such a step would depress growth and seriously impact the nearly new and used markets,’ the SMMT stated.

‘More than £1 billion in revenue would be lost to industry and 5,000 manufacturing jobs put at risk. Additionally, the Treasury would incur a £500 million hit from lost VAT and Vehicle Excise Duty receipts. The total cost would be more than double that allocated to the Electric Car Grant (ECG), effectively wiping out the growth it is intended to stimulate,’ the body added.

Pay per mile plans for BEVs

A further threat could be announced in the 2025 Autumn Budget. The Telegraph reported that Chancellor Rachel Reeves is expected to unveil plans for per-mile road charging, targeting BEV drivers. Drivers of hybrids also look to be affected by the additional cost, but to a lesser extent.

The plans would see all-electric owners pay 3p per mile, with annual payments based on estimates. Should these prove inaccurate, top-up payments would be required, or any overspend would be rolled into the following year. The plans would help balance lost fuel duty revenue.

According to the publication, the average BEV driver would pay an extra £250 a year. The move looks to be framed as one of fairness, with owners of petrol and diesel cars paying £600 on average in fuel duty.

Yet the plans could distort the total cost of ownership on BEVs, especially for those without off-street parking. The government is reducing red tape, allowing councils to install gullies between properties and roads, enabling on-street parking and charging. However, this requires the ability for drivers to park outside their homes. It does not consider those living in flats, without access to dedicated parking spaces.

In this instance, drivers using only rapid or ultra-rapid chargers would pay around 24p per mile for the energy they use, according to the RAC. Using a home charger, the RAC indicates a charging cost of 8p a mile. With the government plans, 3p would be added on top of every mile. Meanwhile, with fuel duty included, drivers of petrol cars pay around 15p a mile.

Increased ownership challenge

‘We recognise the need for a new approach to motoring taxes, but at such a pivotal moment in the UK’s EV transition, this would be entirely the wrong measure at the wrong time,’ commented the SMMT.

‘Introducing such a complex, costly regime that targets the very vehicles manufacturers are challenged to sell would be a strategic mistake. It would deter consumers and further undermine industry’s ability to meet zero-emission vehicle (ZEV) mandate targets, with significant ramifications for perceptions of the UK as a place to invest. A smarter, fair and future-ready taxation system requires a fundamental rethink, one that must be done in full partnership with the industry and other stakeholders,’ the body added.

The automotive market is already tackling the introduction of vehicle excise duty (VED) for electric cars this year. Additionally, many models are now eligible for the Expensive Car Supplement (ECS), increasing their annual tax cost.

The ECG, introduced earlier this year, has also had a small impact on BEV registrations. Only two cars, the Ford Puma Gen-E and Ford E-Tourneo Courier, are eligible for the full £3,750 subsidy. 38 other models qualify for the lower £1,500 offer.

For the third time this year, BEVs made up more than a quarter of registrations in the UK during October. However, the 25.4% share is still below the ZEV mandate target of 28% for 2025. This will rise to 33% in 2026.

But any change in taxation around BEVs, either with the removal of ECOS or the introduction of per-mile charging, could influence buyer decisions around the technology. Once seen as an affordable way of motoring, these changes could push some models out of reach for many drivers.

Have BEVs benefited from incentives?

Registrations of BEVs increased by 23.6% in October, with 36,830 new units taking to UK roads. This was the second full month of the ECG. It was announced in July, and the first models were revealed in early August.

The volume growth, while encouraging, is the fourth-lowest total of 2025 so far. The share of 25.4%, up 4.7 percentage points (pp), is encouraging. However, it may have more to do with the collapse in the petrol market. While the fuel still dominates figures, it has seen volumes plunge each month.

BEV market growth is also being outpaced by PHEVs. Damaging the benefits of all-electric ownership could tip the balance for a powertrain which is already walking a tightrope.

In the first 10 months of 2025, BEV registrations improved by 28.9%. In total, 386,244 all-electric models left showrooms, an increase of 86,511 units. However, this was down from a peak of 34.6% in June. The year-to-date improvement has slipped steadily downwards since the ECG was announced.

Across this period, BEVs took a 22.4% market share. This is up from 18.1% at the same point last year, but the 4.3pp difference is lower than the 5pp increase recorded in June.

PHEVs’ impressive growth

While the BEV market performs well, its pace of growth is being outpaced by PHEVs. In October, registrations for the powertrain increased by 27.2% year on year, as 17,601 new cars were delivered. However, this only equates to a difference of 3,796 units.

The result gave PHEVs a 12.1% market share in the month, up 2.5pp compared to October 2024. Once again, the technology ended the period close to HEVs in terms of volume and share.

Between January and October, PHEV deliveries increased by 37.1%, with 190,240 registrations. The powertrain gained 2.6pp on its 2024 market share, ending the period accounting for 11% of all registrations.

Combining BEV and PHEV figures, the electric vehicle (EV) market saw volumes improve by 24.7% in October with 54,431 registrations. This allowed for a 7.4pp jump in market share to 37.6%.

Across the first 10 months of the year, EVs were up by 31.5% with 576,484 deliveries. Having taken a third of the market for the first time in September, the technology maintained this trend with a 33.5% share, up 7.1pp.

Electrified models lead UK figures again

The UK counts hybrid registrations differently from other major European markets. Rather than merging mild hybrids with HEVs, it splits them into their respective petrol and diesel categories.

With this in mind, HEV deliveries grew by 2.1% in October, with 19,250 units delivered to customers. This equated to a rise of just 388 cars, compared to the same period last year. The small volume improvement meant the HEV market share remained stable at 13.3%, representing a 0.2pp rise year on year.

From January to October, HEVs saw 8% growth, with 241,919 units taking to the country’s roads. This represented a 14% market share, up 0.5pp compared to the same period in 2024.

Combining HEVs with EVs reveals that for the second time, electrified models led the monthly registration figures over ICE. In total, 73,681 models were delivered, a 17.9% rise, equating to 11,185 more units. This gave the technology a 50.8% market share, up 7.5pp.

However, this slim lead was not enough to change the status quo in the year-to-date figures. With 818,403 registrations, electrified volumes were up 23.5%. They held a 47.5% market share, up from 39.9% at the same point in 2024.

With two reporting periods of 2025 left, a large effort is needed for electrified models to lead the market. Between September and October, the year-to-date share only increased by 0.3pp. However, it does suggest that 2026 could be the first year to see ICE succumb to the electrified sector.

ICE holding on in year to date

The petrol market has been in freefall for some time. Despite a rare instance of growth in September, normal service resumed in October, with an 11.6% decline in volumes. In total, 64,360 petrol cars were delivered, down by 8,471 units. The powertrain still led the overall UK market with a 44.4% share, but this was down by 6.1pp year on year.

This performance added to the year-to-date drop the fuel type is experiencing. Between January and October, petrol deliveries were down 8.5% with 814,154 registrations. The market share of 47.2% is still dominant, but down by 6.4pp.

Diesel’s decline also continued in October. With 6,907 units, volumes were down 22.9% year on year. The 4.8% hold of total registrations was the second-lowest of 2025, and 1.4pp down on last year.

Over the first 10 months of 2025, diesel has seen its volumes decrease by 15.1%, with 90,563 units delivered. This left it with a 5.3% market share, down 1.1pp.

Combining the two powertrains, the ICE market fell 12.9% in October as just 71,267 units made it to UK roads. This was a drop of 10,525 units, leaving electrified models to help the new-car market to its slight growth. The performance left the sector with a 49.2% market share.

However, ICE still led across the first 10 months of 2025. With 904,717 registrations, volumes were down 9.2%. But the technology still held 52.5% of the total market, suggesting it will end the year as the leading powertrain group.

For the first time since 2023, new-car registrations in Germany recorded year-on-year growth for three consecutive months. This increase was propelled by a surge in electric vehicle (EV) deliveries. Could new incentives push this result further? Autovista24 journalist Tom Hooker examines the market.

The German new-car market celebrated year-on-year registration growth of 12.8% in September, reaching 235,517 units.

This marked the country’s third consecutive month of improvement, two of which were double-digit increases. According to KBA data, this feat was last achieved between June 2023 and August 2023.

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‘September 2025 shows another significant recovery in the German passenger car market after the promising figures in August and July,’ said Robert Madas, Autovista Group’s regional head of valuations.

This is in stark contrast with the market’s performance over the last two years. Between September 2023 and June 2025, Germany only saw double-digit improvements in January and April 2024.

September also denoted Germany’s biggest registration uptick since August 2023. However, results were skewed by the end of commercial customer purchase incentives for battery-electric vehicles (BEVs) in the following month.

‘The growth is deceptive. It is taking place in an overall weak and declining market,’ explained ZDK president Thomas Peckruhn.

Last month’s sales total was set against the third-largest drop for the German new-car market in 2024. The country faces a more representative challenge next month, as registrations grew by 6% year on year in October 2024.

A total of 2,110,336 new models were delivered to customers between January and September 2025. This figure was down 0.3% year on year, meaning the country could enter the green if results stay strong. It is also a significant improvement on the 4.7% cumulative decline recorded from January to June.

Are BEVs still behind?

BEVs recorded a 31.9% rise in deliveries during September, with 45,495 units. This caps nine months of consecutive improvements for the powertrain, eight of which were double-digit increases.

Last month’s performance could be seen as a slowdown compared to greater growth in August and July. However, the powertrain’s share says otherwise. BEVs represented 19.3% of all registrations in September. This was the technology’s largest share in 22 months and was up 2.8 percentage points (pp) year on year.

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Across the first nine months of 2025, BEV deliveries totalled 382,202 units. This equated to a growth of 38.3% and an improvement of 105,812 registrations. The technology took an 18.1% market share in this period, up from 13.1%.

However, the VDIK stated that this share is still not at the level required to achieve CO₂ limit value targets.

‘We must support the current upswing with sustainable framework conditions to make a BEV share of well over 20% achievable,’ commented VDIK president Imelda Labbé.

‘To achieve the CO₂ targets, we should be open to hybrid powertrains and other technologies. To ensure that the transformation is not accompanied by penalties and job losses, we need a master plan for the ramp-up of electric mobility that focuses on the future viability of the automotive industry,’ she highlighted.

PHEV market soars

One powertrain that can be used in the transition to BEVs is plug-in hybrids (PHEVs). The technology enjoyed a strong September, with an 85.4% delivery increase to 27,685 units.

This continued the technology’s perfect streak of double-digit improvements since January. The powertrain captured 11.8% of overall sales, up by 4.6pp year on year.

Overall, this meant September marked the biggest monthly PHEV volume, growth and market share since December 2022. This month saw a distorted result, due to the imminent axing of PHEV incentives.

In the year-to-date, PHEVs have seen the best growth of any powertrain, up 63.9% to 217,760 units. Their market share of 10.3% in this period was also up, by 4pp year on year.

Combining BEV and PHEV figures, Germany’s new EV market continued its unbreakable run of double-digit growth, with a 48.1% upswing in September.

A total of 73,180 registrations gave plug-in models a 31.1% share of the sales total. This was up 7.4pp year on year. From January to September, EVs posted a 46.6% surge in volumes to 599,962 units. In turn, its cumulative market share soared from 19.3% to 28.4%.

EV purchase incentives return

EVs could soon see demand boosted by incentives. The German government has agreed on new purchase incentives for zero-emission vehicles worth €3 billion through to 2029, according to Bloomberg. The country has not provided any EV purchase subsidies since December 2023.

‘The automotive industry is a key industry for prosperity, jobs and innovation in Germany. We want to strengthen their competitiveness. For this, it is important to further advance electromobility, but at the same time to allow more flexibility and openness to technology in regulation. For this, our industry needs good conditions so that it can survive in international competition with successful products,’ said German Chancellor Friedrich Merz.

The VDIK stated that the focus of the incentives is to be on households with low and medium incomes. However, some of these buyers may only be considering used EVs, which could be affected by the new programme.

‘The announced EV purchase incentives will be a welcome additional step towards accelerating the transition to emission-free mobility, even if not all details are clear yet. The new-car market will benefit from these incentives. However, this will also lead to an additional supply push on used-car markets in the next years, putting further pressure on residual values,’ explained Madas.

‘Now it is important to quickly design residual value-saving incentives for all private customers. The announced measures can only be successful if they are embedded in a master plan that creates framework conditions, such as charging infrastructure and fair electricity prices,’ added Labbé.

Tax exemption extended?

The government also wants to extend the EV vehicle tax exemption until 2035. According to Handelsblatt, this could see vehicles registered by 31 December 2030 available for the incentive. However, it is still unclear whether PHEVs would be included in this scheme.

‘The tax exemption has proven to be an effective incentive and would currently no longer apply to new registrations from 2026 onwards, with unforeseeable consequences for the further ramp-up of passenger cars,’ outlined VDA president Hildegard Müller.

‘If the tax exemption expires at the end of the year, fully-electric vehicles would be taxed even higher than plug-in hybrids – a contradiction that the coalition urgently needs to resolve,’ she added.

Meanwhile, the ZDK highlighted that to achieve a broad ramp-up of EVs, the confidence of private customers must also be strengthened.

‘What we finally urgently need are clear and long-term signals from politicians. Without reliable framework conditions, electromobility remains a risk for many customers,’ Peckruhn said.

Planning security is the basis for investments. This applies to both customers and motor vehicle companies,’ he added.

Hybrids maintain solid growth

Hybrids, including full and mild powertrains, enjoyed a 14.9% growth in September. The result completes 12 months of consecutive improvement for the powertrain. This underlined a significant achievement considering wider new-car registration declines.

A total of 69,527 hybrids took to Germany’s roads last month. This translated to a 29.5% share for the technology, up 0.5pp on September 2024.

More importantly, the hybrid share was 2.7pp ahead of petrol, the biggest advantage ever recorded by the powertrain. In contrast, hybrids trailed petrol by 3.1pp 12 months prior.

In the year-to-date, the technology recorded a 10.6% rise in sales to 603,270 units. It captured 28.6% of overall volumes during the first nine months of 2025. This was 0.6pp ahead of petrol and up 2.8pp year on year.

Adding hybrids to EV figures, the electrified market took a dominant 60.6% share in September, up 8pp year on year. The powertrain grouping posted growth of 29.8%.

The electrified share was lower in the first nine months of the year, at 57%. However, this was still a positive development from its 45.1% market hold recorded between January and September 2024.

Petrol market slows declining trend

Deliveries of petrol-powered cars dropped by 5.9% last month to 63,047 units. While this fits the narrative of falling sales for the fuel type, a positive can be taken from September’s performance. The result ended eight consecutive months of double-digit decline. It also denoted the smallest registration drop since November 2024.

However, when looking through a different lens, petrol’s performance looks dire. Its monthly share of 26.8% was the powertrains’ lowest since December 2022. During this month, buyers rushed to purchase EVs before subsidies were lowered. Meanwhile, last month’s share was claimed from a relatively stable market.

In the year-to-date, registrations of petrol-powered cars slumped by 23.5%, making it the worst-performing powertrain in Germany in terms of declines. The fuel type’s total of 589,951 units translated to a 28% market share, down from 36.4%.

Meanwhile, diesel-powered cars suffered an even steeper 7.2% fall in September to 28,871 deliveries. The powertrain follows a similar story to petrol.

Diesel has managed three consecutive months of single-digit declines, an improvement on its run of double-digit drops, which lasted from December 2024 to June 2025. Yet, diesel’s 12.3% share, down 2.6pp year on year, is the fuel type’s lowest since December 2022.

The powertrain saw sales decline by 18.9% between January and September, with 308,001 units. It made up 14.6% of total new-car volumes, down from 17.9%.

A glimmer of hope for ICE?

Germany’s chancellor, Friedrich Merz, has vowed to ‘do everything’ to stop the EU’s ban on the sale of new cars powered solely by internal-combustion engines, according to Barron’s.

The regulation, which prevents the sale of new petrol or diesel models after 2035, was also discussed in a meeting between the chancellor, some of Germany’s carmakers and automotive industry bodies on 9 October.

The ZDK has backed these efforts, regarding it as ‘a long overdue step towards a greater sense of reality in the European CO₂-Fleet regulation.’

‘We need a climate policy that is not regulated from the top down, but is designed with a sense of proportion, through incentives that consumers take with them, and not through bans that bully car dealers and vehicle manufacturers,’ explained ZDK President Thomas Peckruhn.

‘A blanket ban on new registrations of combustion engines jeopardises urgently needed investments and undermines confidence in the reliability of political decisions,’ he added.

The ZDK also said that for the maximum reduction of CO₂ emissions, alternative solutions are needed. This looks to include efficient ICE models powered by synthetic or biogenic fuels.

‘Our companies are set up to be open to technology, and so should politics. Not every customer, not every fleet and not every mobility need can be mapped purely electrically,’ Peckruhn concluded.

Electric vehicle (EV) registrations continued to help Spain’s new-car market shine in September. But there are concerns that an end to incentives could derail growth. Autovista24 web editor James Roberts delves into the data.

Spain’s new-car market recorded a 13^th consecutive month of growth in September. According to ANFAC data, the country saw 85,167 registrations. This marked a 16.4% rise, compared with 12 months prior, equating to an increase of 12,023 units.

Between January and September, the country’s market was up 14.8% with 854,612 units registered, based on Autovista24 calculations. This positive momentum is at odds with fellow major European new-car markets, which continue to see monthly fluctuations. In contrast, Spain’s new-car registrations have risen consistently since August 2024, which was the last month of recorded decline.

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‘September was the first month since the pandemic in which total sales exceeded the figures for the same period in 2019,’ confirmed Félix García, director of communication and marketing at ANFAC.

‘This is excellent news, further reinforced by the fact that in recent months, the market share of plug-in passenger cars has grown and stabilised at around 20% year to date. These positive figures lead us to expect that total passenger car sales will exceed 1.1 million units by the end of the year,’ he added.

BEV and PHEV share shines

September’s strong new-car market performance was assisted by high demand for electric vehicles (EVs).

Combined, battery-electric vehicles (BEVs) and plug-in hybrid vehicles (PHEVs) accounted for 20,474 registrations according to Autovista24 calculations. This was the fourth-highest total this year, pushing the plug-in market share to 24%. This marked a year-on-year increase of 9.8 percentage points (pp).

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In the year to date, EVs held an 18.6% market share, continuing a skyward trend and a 7.8pp improvement. In these nine months, 158,732 new EVs took to Spain’s roads, a 97.9% year-on-year upswing.

For the fifth consecutive month, PHEVs registered triple-digit monthly gains. Based on Autovista24 analysis, registrations of the powertrain totalled 10,365 units in Spain during September, a 155.1% year-on-year surge. This gave the powertrain a 12.2% market share, up from 5.6% a year ago.

This continues a distinct preference for PHEVs among Spanish consumers. The technology has increased its hold on the new-car market throughout 2025. Spanning the first nine months of the year, PHEV deliveries totalled 86,662 units, a new high year-on-year growth of 105.2%.

EV take off

Between January and September, BEVs accounted for 72,069 new registrations in Spain. This was 34,075 units more than in the same period in 2024, Autovista24 calculates. This ensured an 89.7% year-on-year boost. With this, the powertrain established a new market share high of 8.4%, up 3.3pp.

In September, BEVs recorded growth of 59.7% with 10,109 all-electric cars hitting the roads. Reaching a new high for 2025, the powertrain captured a market share of 11.9%, up from 8.7% a year prior.

‘After several years at the bottom of the European rankings, 2025 has been the year of the take-off of electric vehicles in the Spanish market, with a particular acceleration in recent months,’ outlined Ana Azofra, regional head of valuations and insights at Autovista Group. ‘This technology is working very well in Spain, not only in new vehicles but also in used vehicles.’

‘A more accessible product offer, greater variety in terms of brands and prices, increasingly attractive models, expansion of segments, and, of course, government subsidies, via the MOVES plan, are driving demand for EVs,’ concluded Azofra.

Spain’s EV growth on shaky ground?

This year, electrification in Spain has been boosted by the reintroduction of the MOVES III incentive scheme. This fact was underlined in September, as nearly one in four Spanish passenger car sales was either a BEV or a PHEV.

MOVES III is Spain’s national programme to accelerate the transition to sustainable and electric mobility. It is funded by the EU’s NextGenerationEU recovery funds and is managed in collaboration with Spain’s regional governments. The general objective is to provide financial incentives for both EV purchases and the installation of charging infrastructure.

Notably, this tranche of incentives is due to end on 31 December this year. Amid the irresistible uptake of EVs in Spain, there is concern that consumer interest could be derailed by changes to, or a removal of, current incentivisation guidelines.

Raúl Morales, director of communication at automotive employment association Faconauto pointed out that: ‘According to our surveys, 78% of buyers would not consider purchasing an electrified vehicle without these government incentives.

’Regarding the MOVES programs, we are concerned about the lack of visibility and the absence of budget continuity in those regions where funds have already been exhausted. It is worth remembering that without these MOVES programs, we would hardly be talking now about a market penetration of electrified vehicles approaching 25%, as occurred in September,’ Morales commented.

These concerns were echoed by ANFAC. ‘We are concerned that the exhaustion of the budgets of the MOVES III plan in the main autonomous communities will mean a paralysis of the electrified market. Our employment and our economy need this good market momentum to continue, and to be accompanied by support for industrial investment,’ stated García.

Hybrids continue to lead the way

Mirroring Europe’s wider automotive landscape, hybrid powertrains, including both full and mild-hybrid technologies, continued to lead Spain’s new-car market. This was, however, with the powertrain’s third-lowest total of 2025 in the country.

In September, 35,293 new hybrid cars left dealerships in Spain, based on Autovista24 analysis of ANFAC data. This provided an 18% increase year on year, securing a 41.4% share of the overall new-car market. The enduring appeal of this powertrain was underlined by its share growing by 0.5pp year on year.

Between January and September, 354,741 new hybrid models joined Spain’s car parc, a year-on-year increase of 28.1%. This resulted in a market share of 41.5% for the third consecutive month, a 4.3pp uptick year on year.

Spain’s strong electrified landscape

Overshadowing concerns of the removal of EV incentives, Spain’s electrified market returned to strong growth in September, following the traditionally quiet August.

Combining hybrid and EV figures, the total electrified passenger car sector saw year-on-year growth of 38.4%, with 55,767 units registered. This established a 65.5% market share, the second highest of the year. It also marked a 10.4pp year-on-year jump in share.

In the year to date, electrified powertrains commanded 60.1% of Spain’s new-car market, capping a trend of annual incremental increases. This amounted to a considerable 12.1pp improvement on 12 months ago.

ICE prominence slides downhill

Echoing wider European trends, petrol and diesel registrations in Spain continued to fall in September.

Amid electrified powertrain gains, the overall market share of internal-combustion engine (ICE) vehicles fell to a low of 28.9%, Autovista24 calculates. This equated to a year-on-year nosedive of 12pp. September’s outcome was accompanied by the second-lowest sales volume of the year, at 24,571 deliveries.

In September, petrol registrations fell by 14.5%, with 20,082 units delivered, according to Autovista24 calculations. This gave the fuel type a 23.6% share, a drop of 8.5pp year on year.

Across the first nine months of 2025, petrol power controlled 29.4% of Spain’s new-car market, with 250,936 units leaving national forecourts. Crucially, despite considerable increases in electrified registrations, petrol’s market share has proved resilient.

Until December 2024, diesel prevailed as Spain’s third most popular fuel type. This went against the wider European grain. That is no longer the case as a new low was reached in September. The fuel type rounded out the first nine months of 2025 with 47,238 units registered, and a 5.5% market share, down 4.6pp year on year.

In September, diesel achieved just 4,488 registrations, Autovista24 analysis shows. This left the powertrain with a 30.5% decline compared to September 2024. The technology’s market share was 5.3%, a drop of 3.5pp.

Assessing Spain’s new-car market between January and September reveals a significant decline in combined ICE registrations. An 18.1% slide amounted to 298,174 deliveries this year. This was combined with a new market share low of 34.9%, down 14pp.

With so many hurdles to overcome, is there still hope for electric vehicle (EV) markets around the world? Neil King, head of forecasting at EV Volumes, outlines what is expected to happen to sales with Autovista24 editor Tom Geggus.

EV Volumes expects global light vehicle sales, made up of passenger cars and light-commercial vehicles (LCVs), to grow by 3.6% in 2025. This exceeds the expected 1.1% increase outlined in the previous update.

The reason for this improved outlook is resilient demand in China and the non-Triad region. This forecast factors in US automotive tariffs. However, these are likely to have a smaller impact, with carmakers taking a more cautious approach with their pricing strategies. Other factors taken into consideration include political instability, conflicts, energy prices, and inflation.

Global EV deliveries, including battery-electric vehicles (BEVs) and plug-in hybrids (PHEVs), are forecast to increase by 24.5% this year. This means 22.1 million units are expected to hit the roads. The new forecast is up from the 19.7% growth expected in the previous update.

The improved outlook comes despite some governments phasing out purchase incentives and tax breaks amid mounting national debt, particularly in Europe.

The global EV share of the light-vehicle market is projected to grow to 24% in 2025 and 26.7% in 2026. In the following years, this is predicted to rise to 42% in 2030, before hitting 64.1% in 2035, and 83% in 2040. However, budget pressures and policy shifts may threaten investment in incentives and charging infrastructure.

European EV barriers

Western and Central Europe’s light vehicle market is currently facing a barrage of barriers to growth. There is uncertainty about changing goods tariffs, conflict in Ukraine, and tensions in the Middle East concerning European light-vehicle sales.

On top of this, there are the ongoing risks of increasing inflation, oil prices, and energy costs. Furthermore, the September 2025 OECD Economic Outlook predicts that GDP in the Euro area will only grow 1.2% in 2025. This is slightly higher than the 1% growth in the previous forecast. However, this rate is projected to retreat to 1% in 2026, down from 1.2% predicted previously.

Due to weaker goods exports to the US and a struggling services sector, LCV demand was affected by trade frictions and tariffs. Passenger vehicle sales quickly followed suit. Political uncertainty and rising debt levels are also curtailing light-vehicle demand.

More positively, the EU proposed tariff reductions in August 2025 to implement the EU-US trade agreement. This would see duties on the automotive sector reduced from 27.5% to 15%. The EU-Mercosur and EU-Mexico free-trade agreements have also strengthened the competitiveness of the region’s automotive industry. The UK has also negotiated a more favourable 10% tariff rate with the US.

A lower EV outlook

Reflecting the barriers the region faces, EV Volumes has lowered its European light-vehicle sales outlook for 2025. Volumes are now expected to decline by 1.1% year-on-year by the end of 2025. This is lower than in the previous forecast, which projected a 0.3% decline.

The 14.8 million units now expected this year are far below the 18 million registered in 2019. EV Volumes does not expect the European market to return to that level within the current forecast horizon, up to 2040. A 1.9% growth in light-vehicle sales in 2026 hinges on a complex interplay of regulatory and economic factors.

Stricter EU CO₂ emissions targets are driving EV sales alongside lower prices, discounting, and the launch of new models. Additionally, the EU Commission plans to adopt a binding regulation in 2026 on vehicle recycling. This will require manufacturers to use more recyclable or reusable materials in new cars and vans.

Meeting the lower emissions targets and circularity requirements will necessitate a major increase in EV sales. In turn, this could even trigger a price war, supported by lower lithium costs. Manufacturers may also restrict the supply of internal combustion engine (ICE) vehicles to avoid costly emissions fines.

Schemes and incentives

On a positive note, Italy announced €597 million in funding for a scrappage scheme. Meanwhile, Germany is considering the reintroduction of BEV incentives, although this is uncertain due to the coalition government and prevailing economic conditions.

In July 2025, the Electric Car Grant was launched in the UK. EV subsidies were increased for low-income households in France. Social leasing and a conditional extra financial incentive for electric models were launched at the end of September. Spain has also reactivated subsidies under the MOVES III scheme.

Meanwhile, more affordable BEVs are entering the market, and leading Chinese carmakers are planning further moves in the region.

PHEV registrations have exceeded expectations so far this year. This has been driven by eased CO₂ targets, expanded Chinese PHEV offerings, and delayed launches of low-cost BEVs. Additionally, the UK’s ZEV mandate relaxation means hybrids can be sold until 2035, exempting them from the 2030 new-car ICE ban.

As a result, EV sales in Europe are expected to grow 26.7% year-on-year in 2025 to 3.88 million units. This accounts for 26.2% of total light-vehicle sales, up from 20.5% in 2024 and 21.3% in 2023. BEV volumes are forecast to grow 23.8% year-on-year, accounting for 67.1% of the 2025 BEV and PHEV mix. Meanwhile, PHEV sales are expected to increase by 32.8%.

So, what do new model launches, lower prices, and stricter emissions targets mean in the following years? EVs are forecast to reach a 30.6% share of European light-vehicle sales in 2026 and 36.5% in 2027.

The forecast for 2035 and beyond includes some tolerance for timing interpretations of the new-car ICE sales ban. It also allows for exemptions for vehicles that may be deemed unsuitable for full electrification.

Chinese resilience

Automotive demand and economic resilience have remained firm in China. The OECD recently upgraded the country’s 2025 GDP growth outlook to 4.9%. Meanwhile, EV Volumes has upgraded its light-vehicle market forecast for China. A total of 27.7 million sales are now expected by the end of 2025, equating to year-on-year growth of 6.7%.

This year has seen China’s scrappage programme extended beyond the original January 2025 deadline. However, it has now been suspended in several cities. This could disproportionately reduce demand for EVs given their higher bonus levels.

However, the country has recently announced a plan to stabilise growth in the automotive industry. Accordingly, China is targeting sales of approximately 15.5 million new energy vehicles (NEVs) this year. Alongside this, it is aiming for a 48% NEV penetration rate.

The country also pledged to reduce its greenhouse gas emissions at the latest UN General Assembly. By 2035, China will look to reduce its emissions by up to 10% from their peak levels. This marks the nation’s first commitment to absolute emissions cuts.

Chinese OEMs continue to launch new PHEVs and extended-range electric vehicles (EREVs). Meanwhile, BEVs are regaining momentum, bolstered by aggressive discounting initiated by BYD.

As such, BEVs are forecast to account for 60.1% of EV sales in 2025 and about two thirds by 2031. EVs are forecast to represent 51.6% of light-vehicle sales in 2025, rising to 73% in 2030, then 88.3% in 2035, and 95.7% in 2040.

Forecast volumes are based on retail sales, not wholesale. This excludes exports and inventory build-up, which explains differences from the typically higher wholesale-based figures published by other agencies.

Tariffs, bills and incentives

On 26 March, the US government announced 25% vehicle import duties. However, a two-year ‘import adjustment offset’ program has been implemented for manufacturers producing vehicles in the US.

According to J.D. Power, average new car prices in the US are expected to increase by 5% by the end of 2025. This could lead to an 8% drop in sales. However, many manufacturers did initially absorb the extra costs.

The ‘One Big Beautiful Bill’ act was signed into law in July 2025, ending EV tax credits on 30 September. Any resulting pull-forward effect so far in 2025 is expected to be offset by weaker demand in the final quarter.

Funding for Canada’s iZEV programme ran out in January 2025, with BEV uptake falling and no replacement scheme announced. In response to economic and trade pressures, the Canadian federal government also paused the 2026 Electric Vehicle Availability Standard. This mandated that 20% of new light-duty vehicle sales be zero-emission. The government initiated a 60-day review to assess and potentially adjust future targets.

EV Volumes has updated the 2025 light-vehicle sales forecast for Northern America, covering the US and Canada. The region is now expected to record just over 18 million sales, up 1.2% year-on-year. However, the year-on-year growth outlook was adjusted downward for 2026 to 2029.

The EV share is now expected to reach 10.1% in 2025 and rise only modestly to 10.2% in 2026. This is primarily supported by a more affordable Tesla model. EV shares are forecast to climb to 21.4% in 2030, before achieving 39.8% in 2035, and 59.1% in 2040. This is well below the predicted global EV share of over 80% in 2040.

Non-triad markets weather tariffs

Light-vehicle sales in non-Triad markets have weathered the economic impact of US trade tariffs better than expected. Accordingly, EV Volumes increased its 2025 sales growth forecast to 4.8%.

Japan increased the budget for EV subsidies under the Clean Vehicle Energy Subsidy Programme in early 2025. Meanwhile, India cut import duties for premium EVs as part of a new manufacturing programme in June 2025.

Indonesia introduced VAT exemption for low-emission vehicles in January 2025 and a reduced VAT rate. Finally, in response to US tariffs, South Korea launched temporary stimulus measures. This included financing support and higher EV subsidies.

Budget constraints driven by economic concerns may limit future incentive schemes. Several countries have also implemented, or plan to introduce, new tariffs on imported vehicles. This includes a 50% tariff in Mexico and up to 30% duties in Turkey. Indonesia is also looking to end incentives for imported, completely built-up BEVs, starting in 2026.

Against this backdrop, the EV share in non-Triad countries is forecast to reach 6.7% in 2025. This equates to around 2.1 million units. This percentage is projected to reach 16.9% in 2030, then 41.8% in 2035, and 76.8% in 2040. The region generally lags the global adoption curve by about five years.