The brand new automobile market has entered 2025 with renewed momentum and cautious optimism notably for electrical automobiles and rising manufacturers regardless of geopolitical and financial headwinds, in accordance with Cox Automotive’s newest automobile gross sales forecasts.
Philip Nothard, perception director at Cox Automotive, believes the trade is adjusting to a “new international manufacturing actuality” formed by China’s fast rise and altering client calls for.
“Over the past 18 months, we’ve seen a elementary shift in the place and the way automobiles are being constructed,” mentioned Nothard. “China’s manufacturing surge has been nothing wanting transformative.”
New information from Cox Automotive reveals China’s passenger automobile output grew by 29% between 2019 and 2024, giving it a commanding 40.6% share of world manufacturing. In the meantime, the EU27 and UK noticed their mixed output fall by 21%, shedding 5.1% of their share.
“China’s capacity to provide its home market is staggering,” Nothard added. “Solely 3% of its automobile gross sales come from imports, in comparison with practically 48% within the U.S. That sort of resilience has enormous implications for the remainder of the world.”
Reflecting wider market warning, the worldwide manufacturing forecast for 2024 has been revised down 3% to only over 89 million automobiles. For the UK, that equates to 2.34% of the worldwide whole.
UK market reveals resilience
In the meantime, the UK new automobile market is off to a powerful begin in 2025, with greater than 580,000 registrations in March – the most effective month-to-month determine since 2019.
“This can be a optimistic sign,” mentioned Nothard. “The market is recovering — not simply in fleet, which continues to dominate, but in addition amongst non-public consumers. That confidence is regularly returning.”
Cox Automotive forecasts 2,084,477 new automobile registrations within the UK for 2025, a 29.1% improve from the post-pandemic low in 2022, although nonetheless 9.8% down on 2019 ranges.
“This rebound hinges on the continued success of recent entrants and their capacity to construct sturdy relationships with UK sellers,” Nothard famous. “In the event that they preserve their present trajectory, passing the 2 million mark this yr could be very achievable.”
New model disruption
Chinese language manufacturers proceed to make vital inroads into the UK market. BYD, for instance, secured a 1.6% market share in Q1 2025 – a 625% year-on-year improve – outperforming a number of legacy manufacturers.
“We’re seeing disruption on a scale that’s forcing everybody to rethink their methods,” mentioned Nothard. “BYD’s rise is a wake-up name. With their premium model Denza on the way in which, and different marques like Jaecoo and Omoda gaining floor, the sport is altering quick.”
“Legacy producers want to maneuver rapidly to guard their market share and adapt to a world the place new gamers aren’t simply taking part – they’re main.”
In keeping with Nothard, stakeholders should now align extra intently with Asia’s rising position in automotive manufacturing and adapt their sourcing, logistics, and product requirements accordingly.
“There’s a threat of being left behind if we don’t regulate to this new actuality,” he warned. “European provide is changing into extra constrained, whereas Asia is quickly increasing.”
He additionally cautioned towards chasing quantity on the expense of profitability. “We’ve acquired to guard margins. Meaning providing actual worth to shoppers, particularly as extra folks transition to electrified automobiles. Experience, belief, and infrastructure are going to be completely essential.”
In a market outlined by flux and fragmentation, Nothard believes adaptability would be the key to long-term success.
“The trade has weathered immense disruption over the previous decade,” he mentioned. “What issues now’s how we reply to the subsequent wave – as a result of it’s already right here.”
