New car sales came back from a disappointing June to record a best ever July putting the market back on course for a record year. Last month, new car registrations were up 13.1 per cent to 195,637 beating July 2001 by 22,635 units.

It means sales of new cars since January are up seven per cent year on year from 1.44m units to 1.54m units. The Society of Motor Manufactures and Traders has now raised its forecast for 2002 sales to 2.51m units - up 2.1 per cent on last year's record 2.46m units.

“Sales will start to cool down later this year, but not by enough to stop 2002 being another bumper year,” says Christopher Macgowan, SMMT chief executive.

Private buyers continue to fuel market growth, up 8.4 per cent year to date. Diesel rose by 52.7 per cent in July for a 24.2 per cent market share, the best since January 1994.