Diesel's collapse: market share down nearly 90% in a decade as EVs and regulation reshape car sales

Diesel's share of new-car registrations in Britain has plunged to about 6% in 2025, a fall of roughly 87% from its near-dominant position a decade earlier, according to industry analysis released this month. The shift reflects eroding buyer trust after the Volkswagen emissions scandal, changing tax incentives and the rapid rise of hybrid and battery-electric vehicles.

In 2015, diesel models made up nearly half of all new cars on the market; by 2025 that proportion had fallen to about one in 17 new cars. Industry forecasts cited by analysts predict diesel could account for as little as 2% of new registrations by 2028 if current trends continue.

Analysts and industry figures point to several drivers of the decline. The 2015 Volkswagen emissions scandal, which revealed manufacturers had used software to defeat emissions tests, is widely credited with denting consumer confidence in diesel technology. A survey commissioned by Auto Express and Carwow found 43% of drivers said the scandal had damaged their trust in the industry and discouraged them from buying diesel cars.

Taxation and fleet incentives have also shifted in favour of lower-emission alternatives. Paul Barker, editor of Auto Express, said diesel was once the default for company cars because of favourable tax treatment linked to CO2 emissions, but that electric vehicles now receive stronger incentives for fleets and private buyers. "Diesel has gone from dominating the new-car market to near extinction in just a decade," Barker said. "While sales are dwindling, strong used values show there’s still demand, but the writing is clearly on the wall."

Legislative moves are reinforcing the trend. The government has announced a ban on the sale of new petrol and diesel cars from 2035, and local measures such as expanding ultra-low emission zones and revised vehicle excise duty brackets make diesel ownership less attractive in some segments and urban areas.

Despite the collapse in new-car sales, diesel retains a niche role. Some drivers continue to favour diesel for its higher fuel efficiency on long distances, greater range between refuelling and towing capability. New diesel models remain available across segments, from compact hatchbacks to premium SUVs, and the shrinking supply of new diesel models—about 240 a decade ago versus roughly 91 today—has supported values in the used market.

Data from Cox Automotive cited in industry reporting shows two- to four-year-old diesel cars retain about 51% of their original price, broadly in line with hybrids at 53% and petrol cars at 58%, and significantly ahead of battery-electric vehicles at 36% and plug-in hybrids at 46%. That relative resilience in residual values has made nearly new diesel examples more desirable among some buyers.

Market-watchers say the future for diesel will depend on the pace of regulatory change and continued improvements in electrified powertrains. Forecasts that project diesel falling to around 2% of new registrations by 2028 assume continued policy pressure and growing availability and affordability of electric and hybrid alternatives. Policymakers and fleet managers, meanwhile, are increasingly orienting procurement and infrastructure decisions toward zero- and low-emission options.

Automakers have been reducing diesel lineups in response to weaker demand. Industry commentators say that as manufacturers prioritize electrification, fewer diesel powertrains will be developed or offered, which could accelerate the fuel type's decline beyond current projections. At the same time, a residual market for diesel vehicles is likely to persist where their technical advantages—range and towing—remain relevant.

The contraction of diesel's market share underscores a broader industry shift as governments, buyers and manufacturers adjust to emissions rules and the commercial realities of electrification. Observers note that while diesel remains in use today, its role in new-car sales has been dramatically reduced and may continue to recede as policy and market incentives favour lower-emission alternatives.