The new car market is expected to be moderate this year with a 5% drop predicted, but it will bounce back in 2012.

Paul Everitt, chief executive of the Society of Motor Manufacturers and Traders, said the market would rise by 4.7% next year, predicting a 2.021 million new car market.

Everitt said: “Fleet and business sales will be more sustainable and stable than retail this year. However, business and consumer confidence is expected to weaken.

“People are still well set financially, but it still boils down to how confident they feel.”

Everitt was speaking at the Vehicle Remarketing Association’s first annual conference, where 150 delegates were asked to vote on whether the UK was more likely to see a double-dip recession as a result of the fall in GDP in the last quarter of 2010.

Opinions were split, but 42% believed a double-dip was more likely, 35% said their opinion had not changed and 23% said they believed a double-dip was unlikely.

Looking at the market ahead, Everitt said: “Low emission cars are the future for the industry. It’s the most important thing manufacturers are looking at now and everyone’s moving in one direction to get emissions progressively lower.

“New technologies like electric cars are being introduced to the market, but they will be slow burn. In 10 years’ time people will still be predominantly buying highly efficient combustion engines. Electric vehicles are great, but electricity production needs to be decarbonised.”