March saw record new car registrations despite fears that a fire, which damaged BT phone lines across much of the west country and the north-west, would affect the final figures.

Damaged lines meant that manufacturers and retailers experienced problems registering new car sales online with DVLA for the last three days of the month days (full story page 6). But the SMMT claims any backlog was cleared in time for publication of the March results, which saw new car registrations rise 6.6% to 466,955 units. That figure is likely to surpass September sales for the first time since 2000.

Analysts are considering revising upwards the 2.5m units predicted for 2004, making it the fourth consecutive record year (2003: 2.56m).

The Ford Focus remains the UK's best selling model and also topped the diesel list. Demand for diesel cars continues to climb, with volumes having risen for 42 successive months. Diesel now accounts for 30% of the new car market.

Private buyers took the majority of registrations, up 6.8% year-on-year to 53.5% of the market, overtaking fleet and business sales. They now account for almost half (49.8%) of registrations in the first quarter.

“Although it is still early days, we could be looking forward to a fourth consecutive record year for the new car market,” says Christopher Macgowan, chief executive of the SMMT.

“The growth in a record first quarter has surprised everyone, with March exceeding industry expectations of 450,000 units. If the market continues to be strong, and the underlying economic outlook remains positive, we may well need to revise our 2.5 million unit forecast in the months to come.”

The UK new car market contrasts with continental Europe, where sales continue to falter.