By ATN
Summary: The Advanced Propulsion Centre UK’s latest Quarterly Demand Report indicates that hybrid vehicles will remain strategically important globally into the early 2030s, with BEVs still expected to become the dominant powertrain in the second half of the decade. The report forecasts the UK producing one million vehicles by 2035, though reaching the government’s 1.3 million target would require effectively doubling 2025 output.
Key engineering takeaway: The report signals a slower near-term BEV ramp-up in Europe than previously forecast, with conventional hybrids expected to play a larger transitional role. This has direct implications for powertrain engineering investment priorities, as OEMs must maintain and in some cases expand hybrid development programmes in parallel with BEV platforms rather than treating hybridisation as a near-term phase-out technology.
Why it matters: The revised outlook reinforces hybrid technology as a critical bridge — not just for consumers and charging infrastructure readiness, but for industrial competitiveness and supply chain development. For the UK specifically, the gap between the forecast one million vehicles and the 1.3 million target represents a significant growth opportunity across battery manufacturing, recycling and the wider supply chain, with investments like AESC’s Sunderland gigafactory expansion beginning to anchor domestic cell production capacity.
Hybrid vehicles will remain strategically important globally
The Automotive Quarterly Demand Report from the Advanced Propulsion Centre UK (APC) is released today.
It indicates that, globally, hybrid vehicles will remain strategically important into the early 2030s, particularly in cost‑sensitive regions and markets with limited charging infrastructure.
Battery electric vehicles (BEVs) are still expected to become the dominant powertrain in the second half of the decade.
Across Europe, the APC’s Quarterly Demand Report details a slightly slower BEV ramp‑up in the near term but a more ambitious long‑term electrification pathway. Conventional hybrids are expected to play a larger transitional role than previously forecast.
For the UK, vehicle production and associated battery demand remain broadly aligned with the previous quarter, with, with the UK forecasted to produce one million vehicles by 2035, reflecting a clear upward trajectory over the coming decade.
Dr Hadi Moztarzadeh, Head of Technology Trends, APC, said:
Achieving the UK’s 1.3 million vehicle production target by 2035 will require an uplift of around 250 thousand units above current forecasts, effectively doubling 2025 output.
“This production target unlocks enormous opportunities for growth, innovation, and scale-up across the country’s battery manufacturing, recycling, and supply-chain ecosystem, and whilst forecasts are currently under target, Gigafactory investment is strengthening, evidenced by AESC’s Sunderland expansion, anchoring domestic cell supply for UK automotive industry.
“Hybrid technology is strategically vital as it sustains consumer adoption, supports industrial competitiveness, and bridges gaps in charging and supply chains. The EU’s revised 2035 target ensures flexibility and maintains momentum toward decarbonisation.As reflected on the forecasts, some major OEMs are shifting strategies toward hybrids in the near to mid‑term due to slower‑than‑expected EV uptake and market pressures, reinforcing hybrids’ role as a critical transition pathway”
Read the Q4 2025 Demand Report
For more hybrid technology news, click here.
