The Automotive Update: Registrations, incentives, and tariffs
09 May 2025
Have two of Europe’s biggest new-car markets changed places? What is the latest tariff news? How has the EU updated its CO2 emissions regulation? Autovista24 editor Tom Geggus explores the week’s biggest stories in The Automotive Update podcast.
This episode delves into the intricacies affecting the UK’s new-car market, and benefitting sales in Spain. Autovista24 special content editor Phil Curry shares his views from analysis of the latest registration figures.
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Incentives promote change
While the UK suffered its worst registrations performance in nearly three years in April, Spain’s ascendancy continued. Does this represent a change of pace for both markets when it comes to growth?
Both markets have demonstrated differing approaches to electric vehicle (EV) incentives. In the UK, battery-electric vehicles (BEVs) are now eligible for vehicle excise duty (VED). Since 1 April 2025, these all-electric cars are subject to an annual charge of £195 (€230). Just £10 is payable in the first year of registration.
Additionally, the Expensive Car Supplement will add £425 a year to every BEV with a final price over £40,000. This is only payable between the second and sixth years of registration.
Spain and incentives
On the other hand, Spain recently renewed its MOVES III programme, offering incentives against EV purchases. Buyers can get up to €7,000 if they also scrap a car when purchasing their new one. This not only helps increase EV registrations, but could reduce the country’s car parc average age.
Both these moves could have a significant impact on each country’s registrations, especially their EV markets. However, with anomalous conditions in April’s year-on-year comparisons, May’s figures will provide a clearer picture.
Tariff developments
The EU has launched a consultation on a list of US imports which could be subject to tariff countermeasures. These will be applied if negotiations do not result in a mutually beneficial outcome and the removal of US tariffs.
The list covers imports worth €95 billion, including vehicles and automotive parts. The EU is also launching a World Trade Organisation dispute against the US. It will take aim at the country’s universal tariffs, as well as its tariffs on cars and car parts.
Meanwhile, the UK government has announced a trade deal with the US. This will see tariffs on cars fall from 27.5% to 10%, subject to a quota of 100,000 units. The government has highlighted that this is almost the total number of cars it exported to the US in 2024.
Tariffs are already starting to impact manufacturers. Ford has outlined a $1.5 billion (€1.34 billion) hit to its EBIT due to the situation. Toyota factored in the tariff impact on operating income at 180 billion yen (€1.1 billion) in April and May. Meanwhile, BMW expects US tariffs to decline from July, according to Reuters.
Emissions regulations backed
The European Parliament has voted through the bloc’s CO2 emission standards for new cars and vans. The proposal passed with 458 votes for, 101 against and 14 abstentions.
The change means the fleet CO2 emission target of 93.6g/km for carmakers can be averaged across 2025, 2026 and 2027. So, if a carmaker fails to meet the target this year, they can make it up in the following two.
To speed up adoption, the parliament agreed to deal with the file under its urgent procedure. The draft law now requires formal approval by the European Council, which endorsed the same text on 7 May 2025. Industry body ACEA said the changes offered flexibility during the zero-emission-mobility transition, while accommodating market fluctuations and production cycles. However, green group Transport and Environment commented on the ‘irony’ that the changes come despite a boom in EV sales.
