British Auto Market in 2025 keeps moving upward. YTD sales up to August grew by 2.1%, with Peugeot climbing 5 spots into 8th and reporting standout performance. While EVs dropped 14.4%, BYD jumped across the Top 10 and secured 2nd spot, close to overtake Tesla in 1st.
Economic Environment
In 2025, UK GDP is forecast to grow by 1.3%, before slowing to 1.0% in 2026, weighed down by tighter financial conditions, trade tensions, and persistent uncertainty. Inflation will remain elevated in 2025 due to strong wage growth and higher import prices, but is expected to ease in 2026 as slack builds in the economy. Although the first quarter of 2025 showed a rebound in growth (+0.7% QoQ), weakening business sentiment and subdued consumer confidence indicate mounting headwinds.
The labour market is cooling, with falling vacancies and a projected unemployment rate of 4.6%. Public finances remain under strain: high debt interest costs and restricted fiscal space will push public debt to 104% of GDP by 2026, despite ongoing fiscal consolidation. Monetary easing is underway, with Bank Rate expected to fall to 3.5% by mid-2026, but the fiscal stance remains tight. External demand is also deteriorating, especially due to new US tariffs on UK goods. Structural reforms, particularly in planning, welfare, and childcare, are seen as essential to raise productivity and labour supply while preserving fragile fiscal buffers.
Automotive Industry Trend And Outlook
Despite economic challenges, the UK car market grew 2.1% up to August 2025, reaching 1,26 million units. After reporting negative performance in the first months of Q1, sales turned positive again towards the end and mantained the trend throughout Q2.
Brand-wise, Volkswagen was still the best selling brand with a 9.1% share (+9.4%).
BMW ranked 2nd with a share of 6.2% (-6.3%) while Kia -up 1 spot- ranked 3rd with a 5.9% share (+0.3%).
Ford -up 1 spot- ranked 4th (+7.5%) followed by Audi -down 2 spots- in 5th (-17.1%), and Hyundai -up 3 spots- in 6th (+4.3%).
Mercedes ranked 7th (-7.5%) ahead of Peugeot -up 5 spots- in 8th (+38%), Nissan -down 3 spots- in 9th (-12.3%) and Toyota in 10th -down 2 spots- (-11.7%).
Looking at best-selling models, the leader was still the Ford Puma (+3%). The Kia Sportage followed in 2nd (-2.7%) while the Nissan Qashqai ranked in 3rd (-7.6%).
EV Market Trend and Outlook
Tesla claimed top spot despite losing 8%. BYD -up 12 spots- reported the most impressive performance among best-selling carmakers and is about to become the new segment’s leader (+502.6%).
Medium-Term Market Trend
The decline of the British vehicle market has been ongoing for decades, driven by the relocation of manufacturing to lower-cost European countries, with Brexit further accelerating the downturn. After peaking at 2.6 million sales in 2016, the market began to shrink, hitting 1.6 million in 2020 due to the pandemic. Instead of recovering, sales remained weak, with a 0.7% increase in 2021 followed by a 1.6% decline in 2022.
Ongoing global challenges, including inflation, high fuel prices, political instability, supply chain disruptions, and the transition to EVs, have been amplified in the UK by Brexit’s economic impact. In 2023, the market rebounded by 17% to 1.9 million, with growth continuing into 2024 (+2.6%), despite policy uncertainty. However, over the past decade, sales have declined nearly 20% from 2014 levels.
EV adoption has grown over time but has seen fluctuations, including a slowdown in 2018-19. After peaking in 2023, growth stalled in 2024 as manufacturers struggled with the EV transition and broader market pressures. Reflecting this uncertainty, BMW delayed a £600 million investment in its Oxford plant for electric Mini production.
Tables with sales figures
In the tables below we report sales for the top 40 Brands and top 10 Manufacturers Groups and the top 10 models.
