The vehicle rental and leasing sector’s outlook for 2025 is clouded by tax increases and regulatory uncertainty, according to the British Vehicle Rental and Leasing Association (BVRLA).
The association’s latest Industry Outlook Report suggests that its members are bracing for a challenging year characterised by both growth opportunities and significant headwinds.
Go deeper with GlobalData
BVRLA chief executive Gerry Keaney described the upcoming year as a “Jekyll and Hyde” scenario for the industry, highlighting the tension between rising demand and turbulent trading conditions. “Our energetic, innovative and resilient sector is facing tough times. Expectations that 2025 will see consumer and business demand grow across the board are being offset by turbulent trading conditions and regulatory roadblocks,” he said.
Keaney identified several pressing challenges, including a steep rise in employer National Insurance contributions, regulatory upheaval following the Court of Appeal’s ruling on motor finance commissions, and ongoing uncertainty about decarbonisation targets under the Zero Emission Vehicle (ZEV) Mandate.
“Alongside a shifting operational landscape, BVRLA members and their customers are required to maintain their leading role in meeting ambitious road transport decarbonisation targets,” he added. “Those targets only ramp up, and the report reiterates the sector’s need for support that matches the ambitions.”
Report highlights sector’s resilience amid challenges
The Industry Outlook Report 2025 was unveiled at the BVRLA’s Industry Outlook Conference on 5 December. The event featured insights from industry leaders and policymakers, including Future of Roads Minister Lilian Greenwood MP.
How well do you really know your competitors?
Access the most comprehensive Company Profiles on the market, powered by GlobalData. Save hours of research. Gain competitive edge.
Thank you!
Your download email will arrive shortly
Not ready to buy yet? Download a free sample
We are confident about the unique quality of our Company Profiles. However, we want you to make the most beneficial decision for your business, so we offer a free sample that you can download by submitting the below form
By GlobalDataThe report reflects cautious optimism for 2025, with expectations of improved market conditions, driven by increased fleet demand and lower interest rates. However, sector leaders caution that these improvements will depend on how businesses navigate ongoing challenges such as internal combustion engine (ICE) car supply issues, cash flow pressures, and an increasing regulatory burden.
Notably, concerns for 2025 diverge from those identified for 2024. Residual value risk, supply constraints stemming from the ZEV Mandate, and rising costs and energy prices are now seen as the most pressing issues.
BVRLA takes proactive measures
To address these challenges, the BVRLA has launched initiatives including the #happyEVafter campaign and the Zero Emission Van Plan. These efforts aim to highlight priority areas and provide members with the resources and guidance needed to adapt to changing market conditions.
The association continues to advocate for policies that align with its members’ needs while investing in learning and development tools to support operational resilience.
Despite the hurdles, the report underscores the sector’s adaptability and vital role in advancing the UK’s road transport decarbonisation goals.
