Passenger Car Fleet Market 2025: not an easy year, but a solid one

• Slightly lower new fleet registrations in a modestly growing overall market
• Strong year-end rally for electric models
• BEVs set to become the number one fuel type in 2026

German passenger car fleet market: the 2025 review

With December registrations now available and 2025 complete, it is time to draw an initial balance. While the overall market recorded growth of 1.4 percent thanks to a strong second half of the year, the fleet market closed with a decline of 4.6 percent. At first glance, this may appear a bit sobering. However, there have only been three years to date (2019, 2023 and 2024) with a higher volume in this sales channel. In that respect, there is little reason for either euphoria or major disappointment.

Despite the market decline, several brands managed to increase their own volumes with fleet customers. Within the top 10, Ford (position 7, +11.3%), Cupra (P8, +19.0%) and Skoda stood out, with the latter moving into second place behind market leader VW on the back of 3.0 percent growth. VW sales were slightly down at -2.3%. With a market share of 21.5%, however, the Wolfsburg-based brand achieved its highest full-year fleet share since 2016. That perhaps makes it easier to accept that the crown of the most successful fleet model went to Skoda – unsurprisingly, the Octavia.

Fully electric models made a significant contribution to the strong performance of both VW and Skoda. Here, the ID.7 clearly led the way, followed by the Skoda Enyaq, VW ID.3 and ID.4. Behind the BMW iX1, further Volkswagen Group models rounded out the top eight, including the Skoda Elroq, Audi A6 e-tron and Audi Q6 e-tron.

How are the newcomers performing?

Overall, there were only minor shifts in the brand ranking compared with the previous year. For new (Chinese) manufacturers, it remains difficult to gain a foothold in this demanding True Fleets market – if that is even the goal. An analysis of the “newcomers” reveals very different outcomes in this regard. While brands like Leapmotor or Dongfeng had three out of four new registrations coming from private customers, the share of fleet customers at Polestar exceeds 50 percent. BYD stands at 14 percent, which is at least higher than, for example, MG.

Staying with Chinese manufacturers, there is another noteworthy insight. The EU tariffs that are still in place on electric vehicles produced in China and imported into Europe are clearly reflected in the powertrain mix of some brands. Those with suitable models in their portfolios are able to “divert” volume and bring a higher share of non–fully electric vehicles to market. MG is a typical example of this. Of MG’s fleet registrations in 2025, “just” 40 percent were BEVs. Plug-in hybrids and full hybrids accounted for 23 percent and 22 percent respectively, with a further 15 percent made up of petrol vehicles. Of course, competitors such as Leapmotor, Polestar or Nio are exclusively electric, but the simple equation of Chinese brand equals electric clearly falls short.

What is also clear, however, is that the electrification of German fleets continues with increasing momentum. The share of diesel and petrol vehicles fell sharply last year and has now dropped below the 30 percent mark. By contrast, electric vehicles and plug-in hybrids made significant gains: PHEVs increased by 6 percentage points to 16.4 percent, while BEVs rose by more than 7 percentage points to just under 24 percent. This brings combustion engines gradually within reach. In November and December 2025, pure electric vehicles were already in the lead – and this is very likely to remain the case.

A look into the crystal ball: what the new year will bring (2026)

Following the decline in 2025, the German fleet market is expected to return to positive growth. A glance at the seasonally adjusted trend of recent months already indicates an improvement in 2026. Since September, the SAAR has been rising and reached its highest level of the past year in December. The main drivers will be ongoing electrification combined with pent-up replacement demand in fleets. Numerous contracts concluded in time for the end of the EV subsidy in 2023 – which triggered a veritable boom in the market at the time – are now coming to an end.

Overall, the fleet market is expected to grow by a substantial 10 percent in 2026, corresponding to an additional volume of 86,000 passenger cars. This growth will be driven primarily by a further increase in electric vehicles. An additional 65,000 BEVs represents growth of around 31 percent and will result in a market share of 28.4 percent. This will make EVs the number one powertrain in fleet markets next year. Plug-in hybrids are also expected to post slight growth (+6.7%), but the much stronger rise in BEVs will lead to a loss of market share for PHEVs, which will fall from 16.4 to 15.9 percent. This effect will be reinforced by the fact that, from next year onwards, all new PHEVs will be assessed with higher CO₂ values, making them less attractive for manufacturers considering looming CO₂ penalties.