New car registrations dropped by five per cent last month as buyers held back ahead of the Government's new electric vehicle grants, preliminary figures reveal.
Approximately 140,000 new cars were registered in July, down from 147,517 during the same month in 2024. Battery electric vehicles maintained a 21 per cent share of the new car market despite the overall decline.
Electric car grants announced
The Society of Motor Manufacturers and Traders, which released the preliminary figures, slightly upgraded its forecast for full-year new car registrations to 1.9 million. Last year's registrations reached 1.95 million vehicles.
Battery electric vehicles are forecast to hold a full-year market share of 23.8 per cent. At least 28 per cent of new cars sold by each manufacturer in the UK this year are required to be zero emission under the Government's zero emission vehicle mandate.
First models approved for savings
The first electric car models eligible for new Government grants were announced on Tuesday. Drivers will be able to save £1,500 with the purchase of new Citroën e-C3, e-C4, e-C5 and e-Berlingo cars.
These are the first models approved under the new £650 million electric car grant scheme. The programme will enable motorists purchasing a new electric car to save either £1,500 or £3,750, depending on the vehicle's sustainability.
Buyers waiting for clarity
Ian Plummer, commercial director at online vehicle marketplace Auto Trader, said the grant has provided a "much-needed boost" for consumer interest in new electric cars. Electric vehicle consideration is up 10 percentage points on Auto Trader following the announcement.
The unveiling of the initiative on July 14 explains why it was a "slow" month for sales as buyers "wait to see just which models will get what level of grant". Plummer added that discounts will "trickle through to EV sales in the coming months".
Final figures for July's new car registrations will be published at 9am today.
(PA) Note: This article has been edited with the help of Artificial Intelligence.
