The UK rental sector is entering a period of significant change.
Demand remains steady, but companies are facing higher costs, supply pressures, and an accelerating shift toward electric vehicles.
At the same time, customer expectations are evolving, with businesses and individuals looking for more flexible and sustainable ways to rent and manage their mobility needs.
The state of the market
According to the latest industry data from the BVRLA Leasing Outlook (April 2025), the total fleet managed by BVRLA members reached 1,959,468 vehicles by the end of 2024.
This represents a modest 0.65% year-on-year increase, but marks the highest total in six years. Cars continue to lead this growth, with the car fleet up 4.86% year on year, while the van segment fell by almost 11%, despite a small rise in new vehicle registrations. This shows how challenging it remains to source and operate commercial vehicles cost-effectively, especially for companies supporting business and logistics clients.
Business demand continues to outperform personal use. Personal contract hire declined by around 13% year on year, reflecting more cautious consumer spending.
In contrast, salary sacrifice schemes grew by over 60% in 2024, reaching more than 100,000 vehicles. These schemes have become a key entry point into electric vehicle use, underlining the strength of employer-driven mobility solutions.
Electric vehicle adoption is accelerating across the market. In business fleets, 54% of new orders in Q4 2024 were fully electric vehicles, while personal adoption rose from 16% to 28% in just one quarter.
This rapid growth highlights how electric mobility is becoming a mainstream choice for both organisations and individuals.
However, rising volumes of used EVs and aggressive pricing from manufacturers are putting pressure on resale values. For rental and mobility providers, managing asset value and replacement cycles has become increasingly complex.
You can read the full findings in the BVRLA Leasing Outlook Report 2025.
What this means for rental businesses
The data highlights both progress and pressure.
Vehicle supply remains tight, and competition between leasing, corporate, and rental operators is driving up acquisition costs.
The decline in van availability also affects companies that rely on commercial vehicles for customer deliveries or fleet support.
The transition to electric vehicles presents both a challenge and an opportunity.
Businesses that invest early in electrification can build a competitive advantage and strengthen their sustainability credentials.
However, this shift also requires investment in charging infrastructure, staff training, and data-driven fleet planning.
Rising operating costs from insurance and compliance to maintenance and tax are tightening margins across the sector.
Digital innovation and automation can help reduce costs and improve efficiency, while stronger customer service and flexible rental options remain key to long-term success.
