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The UK new car market saw year-on-year growth of 17.9% in 2023, making it the best year for registrations since before the Covid-19 pandemic.
Figures from the Society of Motor Manufacturers and Traders (SMMT) show that a total of 1.903 million new cars were registered.
The growth was driven entirely by the fleet market, which bounced back having experienced supply restrictions in 2022, with 38.7% year-on-year growth, accounting for 54% of registrations overall.
Business registrations - classed as those to firms with fewer than 25 vehicles - were down by 47.3%, for a 2.3% market share, while private registrations fell by 0.1% for a 43% market share - the latter attributed by the SMMT to cost of living pressures and high interest rates.
Despite the overall market increase, registrations in 2023 were still down by 17.7% compared with pre-pandemic levels.
In terms of fuel mix, EV registrations increased by 17.8% year-on-year in 2023, accounting for 16.5% of the overall market, although the latter figure was in fact a slight decline on the 16.6% EV market share seen in 2022.
Plug-in hybrid registrations rose by 39.3%, taking 7.4% of the market, while conventional hybrids were up by 27.1% for a 12.6% market share.
Mild hybrid petrol car registrations were up by 32.5%, for a 15.3% market share, while mild hybrid diesels were down by 1.9%, accounting for 3.7% of the market.
Petrol car registrations rose by 13.5% for a 40.7% market share, while diesels were down by 13.8%, taking 3.8% of the market.
The shifting fuel mix contributed to the average CO2 emissions figure for new cars registered falling by 2.2%, to 108.9g/km.
Commenting on the figures, SMMT chief executive Mike Hawes said: "With vehicle supply challenges fading, the new car market is building back with the best year since the pandemic. Energised by fleet investment, particularly in the latest EVs, the challenge for 2024 is to deliver a green recovery.
"[The] government has challenged the UK automotive sector with the world's boldest transition timeline and is investing to ensure we are a major maker of electric vehicles. It must now help all drivers buy into this future, with consumer incentives that will make the UK the leading European market for ZEVs."
Giving his reaction to the figures, Lex Autolease managing director Nick Williams expressed concern about the year-on-year fall in EV market share.
He said: "Last year marked a slowdown in the UK's transition to electric vehicles with the proportion of sales falling significantly below the 2024 ZEV mandate, despite volumes exceeding prior years.
"The long-term commitments made by [the] government have helped to support uptake, but it's clear that more needs to be done by policy makers, OEMs and the wider industry to drive adoption levels to ensure the UK remains an attractive place to invest.
"Efforts must be focused on the continued rollout of charging infrastructure, driving down new vehicle costs and providing OEMs with the confidence they need to invest in the long-term, all of which will be key to generating the used market, essential in making electric vehicles more accessible and achieving widespread adoption in the future."
Novuna Vehicle Solutions managing director Jon Lawes said: "Whilst fleets continue to charge ahead with EV adoption, policymakers must demonstrate greater ambitions during 2024 to inspire confidence in the transition and help the industry make good on the new ZEV mandate taking effect this week.
"The last-minute reprieve on the costly Rules of Origin tariffs was a crucial moment for EV adoption, but inadequate charging infrastructure coupled with the lack of incentives to convince non-fleet drivers to make the switch remain significant barriers to realising wider EV growth and still need addressing."
The whole-year figures have been published alongside those for the month of December, which show 9.8% year-on-year growth, including 32.9% growth in fleet registrations.
However, December saw a 34.2% year-on-year decline in pure EV registrations, although the SMMT attributed this to an abnormal December 2022 when significant numbers of orders were able to be fulfilled.
The organisation added that the next few months were also likely to be volatile for EV sales, due to the regulatory uncertainties that have beset the market over the past few months. In particular it cited the last-minute nature of the deal on UK-EU Rules of Origin, which it said although avoiding tariffs on EVs had made planning difficult.
The UK's best-selling car in 2023 was the Ford Puma, which clocked up 49,591 registrations.
The top seller from 2022, the Nissan Qashqai, took the number two spot with 43,321 registrations, while the Vauxhall Corsa was third with 40,816.
Completing the top ten were the Kia Sportage (36,135 registrations), the Tesla Model Y (35,899), the Hyundai Tucson (34,469), the Mini hatch (33,385), the Nissan Juke (31,745), the Audi A3 (30,159), and the Vauxhall Mokka (29,984).
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