UK EV demand falters as petrol and diesel regain appeal, EY finds

UK car buyers are signaling a renewed preference for traditional petrol and diesel models, even as policy makers push for a rapid shift to zero-emission vehicles. The latest EY Mobility Consumer Index shows a clear reversal in buying momentum for electric vehicles (EVs) and a strengthening appetite for internal-combustion engine (ICE) models among prospective buyers. In a poll of 1,032 UK motorists intending to purchase a new car in the next 24 months, 41% named ICE as their preferred powertrain, up from 36% in 2024 and more than twice the 19% who expressed a preference for EVs. The results, drawn from responses collected between September and October 2025, suggest EV uptake remains well short of legislative targets, even as government incentives continue to support the EV market.

Two in five respondents cited high upfront costs as the principal barrier to electrified vehicles, with 41% signaling price concerns. Other common deterrents include limited driving range (36%), the potential cost of battery replacement (30%), and a perceived lack of charging infrastructure (47%). Long charging times (45%) and the expense of accessing public charging networks (40%) also weighed on decisions to go electric. The EY survey nonetheless found that current EV owners remained relatively loyal, with 84% indicating they are likely to buy another EV in the future. Separately, 88% of respondents said a European-made car ranked among their top three preferences, up from 63% a year earlier, while interest in Chinese-brand models remained muted (7% top-three).

The poll highlights a broader shift in sentiment as the UK debates how to align incentives with a 2030 ban on new petrol and diesel car sales. EY notes that uptake in EVs continues to lag behind the policy targets, prompting calls from the consultancy for further incentives to accelerate demand as the decade progresses. The study also found that the share of respondents who expect to buy a hybrid vehicle fell to 19% from 27% in 2024, while interest in plug-in hybrids (PHEVs) stood at 10%, a level EY says is likely to be strained by new tax rules coming into force.

Policy and market context increasingly intersect with consumer sentiment. In the Autumn Budget, Chancellor Rachel Reeves announced a pay-per-mile levy on electric vehicles, the so-called eVED, intended to fund road maintenance by charging EV drivers per mile. The government says the ECG extension preserves the existing discount and supports EV affordability, but the new per-mile tax, slated to begin in 2028, has drawn pushback from carmakers and industry groups. The Office for Budget Responsibility (OBR) estimated that the 3p-per-mile charge could lead to about 440,000 fewer battery-car registrations between now and 2030, a projection the Treasury has said may be mitigated by the ECG extension but remains a concern for the industry.

Automakers have responded publicly to the policy pivot. Ford characterized the eVED as sending a confusing signal at a time when the EV transition already faces headwinds, saying, “Against a hugely challenging market, and compliance targets drifting out of reach, this is the wrong tax at the wrong time.” Polestar, whose chief executive noted that EV drivers should contribute to road costs, argued that the policy could deter those accelerating the transition to clean transport and urged a broader review of fuels duty. The Society of Motor Manufacturers and Traders (SMMT) warned that the per-mile levy could dampen demand for the very vehicles the policy seeks to promote and could undermine the UK’s attractiveness as a place to invest in automotive manufacturing, potentially slowing progress toward the 2035 output target of 1.3 million units.

In November, SMMT data showed that electric-vehicle registrations cooled to their weakest pace in almost two years, with EVs accounting for 26.4% of new car registrations for the month, just above the 25.1% seen a year earlier. On a calendar-year basis through November, EV share stood at 22.7%, well below the government’s 28% annual target under the Zero Emission Vehicle mandate. The industry body’s chief executive, Mike Hawes, reiterated that introducing an electric-vehicle excise duty was the wrong policy tool at the wrong time and urged collaboration to reduce compliance costs and protect the UK’s investment appeal.

The EY report placed the broader buying climate in the context of consumer cost pressures and policy uncertainty. About half of respondents (49%) said they were either extremely likely or somewhat likely to purchase a vehicle in the next two years, down from 56% a year earlier and roughly in line with a broader 32-market average. EY UK and Ireland mobility leader Maria Bengtsson described the shift toward ICE and the softer EV demand as surprising but not derailment-prone, noting that there are still reasons for optimism. She cautioned that the mileage-based tax could become a barrier to demand and called for policymakers to consider additional incentives to unlock demand as the decade progresses.

The EY study also examined preferences around vehicle provenance and shopping channels. A striking 88% of respondents said a European-made car would be among their top three choices, up sharply from 63% the prior year, while only 7% included a Chinese model. Shoppers also indicated a tilt away from traditional showrooms, with just 36% preferring to buy from a physical dealership, down from 53% in 2024. Online purchasing rose to 35% from 33% a year earlier, signaling a continuing shift to digital channels as the car-buying process evolves amid higher vehicle prices.

Looking ahead, EY emphasized that the environment, energy costs and evolving policy landscapes will continue to shape buyer intent. For EVs to gain traction, the report suggested that policymakers will need to balance price incentives, charging infrastructure expansion and a credible plan for road-use funding that does not undermine the competitiveness of zero-emission vehicles. Industry participants say a coherent framework that aligns taxes with road costs and environmental goals will be essential to preserving the UK’s automotive investment pipeline while meeting the 2030 and 2035 targets.