Israel Records All-Time High Car Registrations in 2025 Despite Import Drop
Israel's car market saw a record 290,000 new passenger vehicle registrations in 2025 despite a 25% drop in imports, driven by pre-tax hike stockpiles and strong demand for Chinese electric and hybrid models.
Israel's automotive sector experienced a striking paradox in 2025, marked by a sharp contraction in vehicle imports alongside a record-breaking surge in new car registrations. According to the Tax Authority's periodic report, approximately 290,000 passenger cars were registered for use in 2025, representing an 8.4% increase compared to 2024 and the highest figure ever recorded in the country.
This growth contrasted sharply with import volumes, as only about 250,000 total vehicles were imported into Israel throughout 2025—a 25% drop from 2024. Specifically, passenger car imports fell by 26.3% to roughly 240,200 units, meaning registration numbers outpaced imports by 21.4% during the period.
The Role of Advance Inventories and Tax Adjustments
The dramatic gap between imports and registrations stems from preemptive actions taken by vehicle importers. Ahead of tax hikes implemented in January 2025, importers rushed massive shipments into the country during December 2024, accounting for one-third of total import volumes across 2024 and 2025 combined.
These accumulated inventories enabled dealerships to maintain peak delivery rates, with January 2025 alone seeing more than 50,000 passenger cars hit Israeli roads. Concurrently, the total financial value of imported vehicles dropped to 23.6 billion shekels, a 20.9% decrease driven by smaller physical quantities, lower import prices, and an influx of more affordable electric models.
Chinese Dominance and Alternative Powertrains
China solidified its leadership in the Israeli market, accounting for 96% of plug-in hybrid vehicles and 88% of fully electric vehicles imported in 2025. This transition toward alternative powertrains occurred despite the scaling back of government tax incentives, including an increase in the purchase tax on electric vehicles to 45% in 2025.
Advanced powertrain vehicles—comprising hybrids, plug-in hybrids, and fully electric cars—captured approximately 60% of all passenger car registrations in 2025. Standard hybrids led the market with 28.4% of total registrations, followed by fully electric models at 20%, and plug-in hybrids at 11.9%.
