Eight months of decline for UK new van market

The UK’s new light commercial vehicle (LCV) market has recorded its eighth consecutive month of decline, with registrations falling by -5.1% in July to 24,433 units, according to the latest data from the Society of Motor Manufacturers and Traders (SMMT).

The persistent downturn is putting pressure on the sector’s transition to electric vehicles (EVs), as economic headwinds continue to dent fleet investment and business confidence.

This marks the weakest July performance since 2022, with declines seen across most LCV segments. The steepest drop was among the smallest vans, where demand plummeted by -20.6%. The largest van category also slipped -4.6%, while the pickup segment – affected by recent tax changes – saw a -17.3% fall in registrations. Mid-sized vans and 4x4s were the only bright spots, up 2.5% and 0.5% respectively.

Electric vans see strong growth, but lag behind targets

Despite the broader market contraction, battery electric vans (BEVs) continued to gain traction, with registrations up 72.6% year-on-year in July, reaching 2,442 units. This represents eight consecutive months of BEV growth, underscoring growing interest and availability – with more than 40 electric van models now on the market.

However, BEVs still account for only 8.8% of total LCV registrations so far this year, well below the 16% share required under the UK’s ZEV mandate. With 2026 targets set to jump to 24%, the current pace of adoption is not enough to meet regulatory thresholds, raising concerns about potential non-compliance and missed environmental goals.

Outlook revised down as challenges mount

In light of the sustained downturn, the SMMT has revised its 2025 market forecast downward, now expecting total LCV registrations to reach 321,000 units – a drop of more than 30,000 from earlier projections. The BEV market share for next year has also been adjusted downward to 8.6%, with only 13.7% expected in 2026, still far below the mandated 24%.

Mike Hawes, SMMT Chief Executive, said: “Eight months of LCV market decline underlines the ongoing economic pressures facing businesses, yet the sector remains steadfast in its commitment to decarbonise. Manufacturers continue to invest in delivering a diverse range of zero emission vans to suit every use case, and it’s encouraging to see uptake growing – but to meet mandated targets, it must grow faster.”

With the UK’s electric van rollout at risk of falling short, the SMMT is calling for urgent action to address infrastructure and planning bottlenecks. Key priorities include:

• Faster depot grid connections to support fleet electrification.
• Streamlined local planning approvals for charging infrastructure.
• Targeted financial support to help businesses switch to zero-emission vehicles.

Without these measures, the van sector – a critical component of UK logistics, construction and last-mile delivery – may struggle to meet climate targets and keep pace with global decarbonisation efforts.