Britain’s car market delivered a surprisingly strong performance in March, with new vehicle registrations rising nearly 7% year-on-year. However, industry leaders warn that the momentum may
be short-lived as geopolitical tensions—particularly the escalating Iran crisis—begin to weigh on consumer confidence and costs.
According to the Society of Motor Manufacturers and Traders (SMMT), a total of 380,627 new cars were registered during the month, traditionally the busiest period for the sector. This marks the strongest March showing since before the pandemic in 2019.
Yet beneath the upbeat headline figures lies a more cautious reality. Much of March’s growth was driven by orders placed earlier in the year, before the geopolitical situation in the Middle East began to deteriorate.
SMMT chief executive Mike Hawes emphasized that the industry is already feeling pressure. Rising energy prices and supply chain disruptions linked to the Iran conflict are expected to push up costs for both manufacturers and consumers. At the same time, households facing a higher cost of living may delay big-ticket purchases such as new cars.
Electric vehicles (EVs) continued to gain traction, recording their strongest March in terms of volume. However, their market share reached just 22.6%, still well below the UK government’s mandated target of 33% by 2026. While higher fuel costs could push more drivers toward EVs, increasing electricity prices and production expenses may offset that shift.
Competition in the EV market is also intensifying. Tesla posted a 20% rise in UK registrations to 8,599 units. However, it was overtaken by Chinese rival BYD, which saw registrations surge by 133% to 15,162 units—highlighting the growing influence of new global players in the British market.
Overall, while March’s figures suggest resilience, the industry faces an increasingly uncertain road ahead.
UK car sales context (2004–2025)
To understand today’s market, it helps to look at the broader trend over the past two decades:
- 2004–2007: Strong and stable growth, with annual registrations hovering around 2.5–2.7 million units.
- 2008–2009 (Global Financial Crisis): Sharp decline, falling below 2 million units in 2009.
- 2010–2016: Recovery period, peaking in 2016 at ~2.69 million cars, one of the best years on record.
- 2017–2019: Gradual decline due to diesel concerns, Brexit uncertainty, and changing consumer habits.
- 2020 (COVID-19 pandemic): Historic collapse to 1.63 million units, the lowest since 1992.
- 2021–2022: Weak recovery, constrained by semiconductor shortages and supply chain issues.
- 2023–2025: Gradual rebound, driven increasingly by electric vehicles, though total volumes remain below pre-2017 levels. Photo by Tokumeigakarinoaoshima, Wikimedia commons.
