Aerial view of a large car park filled with rows of white, black, silver, and red vehicles, bordered by dense green trees on one side.

How the new car market is changing in 2025

You may be aware that plenty is changing in the motor industry right now. Car firms are facing pressure from many different areas. This could impact the type of new cars you can choose on the Motability Scheme.

Independent motoring expert Richard Aucock* explains all.


After years of disruption, new car supply has steadily been returning to normal. First it was the pandemic, then shortages of key components such as computer chips. This saw production at car factories fall. It led to longer waiting times for Motability Scheme customers. As these issues have been resolved, taking delivery of your next new car has become faster.

However, challenges remain in the motor industry. Legislation is demanding an ever-higher number of new electric cars must be sold. Developments in safety technology are helping make cars safer, but public awareness remains an obstacle. The type of new car people prefer is changing, while many new car brands are arriving.

To help you understand the challenges in the motor industry in 2025, here are some of the pressures car manufacturers face.

Driving the switch to electric

2025 is the second year of the government’s Zero Emissions Vehicle Mandate, or ZEV Mandate. Car makers are required to register an increasing number of electric vehicles, or EVs, each year. The proportion was 22% of all their UK sales in 2024. It increases to 28% in 2025. By 2030, 80% of all new cars sold must be fully electric.

Graphic showing new car registrations in May 2025 by fuel type, year-on-year percentage changes, and market shares. Source: SMMT.

A graphic showing new car registrations in May 2025 by fuel type, year-on-year percentage changes, and market shares. Source: SMMT.

There are some new flexibilities for the ZEV Mandate for 2025. The fines for car manufacturers who miss their EV sales targets have been reduced. They fall from £15,000 per car over target, to £12,000. There are also more flexibilities in the calculations car firms make to work out their ZEV Mandate targets.

While the phase-out of regular petrol and diesel cars from 2030 has not changed, hybrids will now be allowed from 2030-2035. This includes regular hybrids (known as HEVs) as well as longer-range plug-in hybrids (PHEVs). However, from 2035 the target is that only fully-electric new cars will be sold in Britain.  new cars will be sold in Britain.

What this means for Motability Scheme customers is a shift in the type of new cars available. You may already have seen there are fewer diesel cars. This is a shift that’s been underway for several years. There will gradually be fewer petrol cars available too, with hybrids taking over. Fully electric cars will significantly grow in number.

Disabled drivers and electric car charging

There is growing awareness that some disabled drivers can struggle to use public electric car chargers. Challenges include the weight of charging cables and the force required to attach the connector. A lack of dropped kerbs around chargepoints and unsuitable parking arrangements are also problematic.

The Motability Foundation, which oversees the Motability Scheme, believes that all public EV chargepoints should be accessible. Working with the government, the Motability Foundation commissioned the British Standards Institute (BSI) to develop a national accessible charging standard for EV chargepoints.

The standard has now been published. It is called ‘PAS 1899’. The Motability Foundation will support its uptake and ensure it is used as widely as possible to make public EV charging accessible to all.

A man in a rust-coloured jacket charges a red electric car at a roadside EV charging point, holding a walking aid under one arm.

New brands and changing preferences

The arrival of new brands in the UK is gathering pace in 2025. In recent months, Chinese electric car brands Xpeng and Leapmotor have arrived in the UK, along with hybrid car brand Haval. They join the fast-growing model ranges of BYD, Omoda and Jaecoo. All three are already outselling several familiar and well-established brands.

In the future, many of these new car brands could be sold at a familiar dealer local to you. They might sit alongside established brands, or replace a familiar carmaker entirely. It means that you’ll still be able to visit the Motability Scheme experts you know, just with a different brand to the one you may have leased previously.

There are changes in the type of new cars now popular in the UK as well. 2024 saw the departure of the famous Ford Fiesta small car. Reflecting the preferences of today’s drivers, the Ford Puma small SUV effectively takes its place in the range. It offers easier access, a higher seating position and a large boot. All are important attributes for Motability Scheme customers.

There is also an electric Ford Puma Gen-E. This looks almost identical to the hybrid petrol Puma models, but has battery electric power and a range of up to 233 miles. It follows the trend of car firms launching electric alternatives to their popular petrol models.

This trend towards more SUVs and more electric cars will continue in the future. It’s worth bearing this in mind as you use the ‘Find a vehicle’ tool on the Motability Scheme website.

Assisted driving and accessibility

New technology is helping make driving safer and easier. All new cars must be fitted with a number of additional safety features as standard. This is part of the Europe-wide General Safety Regulation, or GSR2. Features include driver drowsiness and attention warning. They also include automatic emergency braking, sometimes known as AEB. I’ve driven hundreds of new cars fitted with AEB as standard and can vouch for how effective it is in avoiding collisions.

Top-down illustration of a car using autonomous driving or driver assistance technology, with blue radar-like sensor waves detecting surrounding vehicles in adjacent lanes.

Some new cars are also available with additional ‘assisted driving’ systems. These offer what’s called ‘partially automated’ driving on long journeys. Drivers must still keep their hands on the wheel and eyes on the road, but the car will partly ‘drive itself’ in safety. Expect awareness of such assisted driving technology to grow as more manufacturers offer it on new cars.

For disabled drivers, assisted driving systems could help make motoring easier and safer, particularly on long motorway journeys. “Technology fitted to today’s vehicles can work as eyes and ears to help keep road users safe, using sensors and cameras to detect potential hazards, warn drivers, and take corrective action automatically,” explains Euro NCAP, the European safety testing organisation.

Motability Scheme all-inclusive package

Whatever happens in the new car market, the support you receive from the Motability Scheme remains the same. The all-inclusive package includes insurance cover, servicing and MOT, breakdown cover and support with your electric car.

As the motor industry shifts to electric cars, the Motability Scheme will help with a home chargepoint and standard installation as part of your lease. If you don’t have a driveway, you will be given access to the bp pulse network of over 9,000 public chargepoints. This helps make leasing an electric car on the Motability Scheme as easy as possible.

I think there has rarely been a more exciting time to be in the market for a new car. The choice is broader than ever, and some of the latest new models are high-tech marvels that are great fun to drive.

With the right help from the Motability Scheme, and your local dealer, I’m sure you’ll find the best new car for you. Happy motoring!

Learn more about the Motability Scheme

The Motability Scheme helps more than 800,000 customers keep moving through our all-inclusive lease package. Insurance, breakdown assistance, servicing and maintenance are all included.

Request information to learn more about how the Scheme works.

*About the author

Richard Aucock has been a professional motoring writer since 1998. He’s written about the car industry for the Motability Scheme since 2009. He has many key roles in the motoring world, including the UK juror for AUTOBEST, a juror for the World Car Awards, and Vice Chair of the Guild of Motoring Writers. Richard is also the director of Motoring Research, a leading UK publisher in the industry.

Featured image credit: Fahroni / Getty Images

From the Motability Scheme


Categories


Popular articles

Top