Fleet growth is holding up, EVs are reshaping car fleets, and salary sacrifice continues to accelerate, but rising costs and policy uncertainty are testing confidence. FleetWise distils the five most important insights from the BVRLA’s 2026 Industry Outlook Report.
1. Fleet growth is real, but uneven
The UK lease fleet grew 8% year-on-year to almost 2.0 million vehicles, with car fleets up 12.5%. Vans, however, fell 4.2%, reflecting high purchase costs and limited viable electric options. Fleet operators are extending vehicle lifecycles rather than rushing replacement.
2. Salary sacrifice is doing the heavy lifting
Salary sacrifice is now the fastest-growing fleet segment, up 123% year-on-year. Employers are using competitive EV pricing and tax efficiency to attract staff, with growing uptake from lower-rate taxpayers as more sub-£37,000 EVs enter the market.
3. EVs dominate car fleets, EV vans lag
Battery electric vehicles now account for 47% of business contract hire cars and 83% of salary sacrifice fleets, helping cut average emissions to a record 40.2g/km. Vans tell a different story: diesel still makes up nearly 90% of leased LCVs, with electrification largely limited to large operators.
4. Used EVs are moving from risk to opportunity
Confidence in battery health is improving, with leasing firms now running used EVs for seven to eight years. The challenge is pricing them attractively enough against heavily discounted new models to unlock demand.
5. Policy uncertainty is the biggest brake on confidence
Residual value pressure, ZEV mandate compliance and proposals for an electric pay-per-mile tax are creating uncertainty. The sector remains resilient, but the report is clear that policy clarity will be critical to sustaining momentum through 2026.
Read the BVRLA's Industry Outlook report in full.
