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UK new car registrations were up by 28.3% year-on-year in July, making 12 consecutive months of growth, according to figures from the Society of Motor Manufacturers and Traders (SMMT).
As regularly seen in recent months, the increase was chiefly driven by the fleet market rebounding from last year's supply problems, with registrations to the sector up by 61.9%, accounting for 56.3% of the overall market.
Business sales, classed as those to fleets with fewer than 25 vehicles, were up by 28.7% for a 2% market share, while private registrations grew by 0.3%.
In terms of fuel mix, perhaps unsurprisingly in light of the major fleet market gains, there were big year-on-year increases in pure EV sales, up by 87.9% to take a 16% market share, and in plug-in hybrid registrations, up by 79.1% for an 8.1% market share.
Conventional hybrids were up by 18.9%, taking 11.3% of the market.
Mild hybrid petrol cars also saw strong growth, up by 56.8% to take a 16.4% market share, however mild hybrid diesels were down by 23.1% for a 3.8% share.
Pure petrol car registrations rose by 13.4%, accounting for 40.4% of the market, while diesels were down by 8.4% for a 4% market share.
The SMMT said that last month's sales figures were the strongest seen for July since 2020, when pent-up demand for new cars had built up during three months of Covid-19 lockdown.
It said the market had achieved a full year of growth despite challenging economic conditions, due to supply chain challenges easing and production therefore increasing.
The SMMT said it was now forecasting a total of 1.847 million new car registrations for the whole of 2023, representing a 0.9% rise on its previous prediction, issued in April.
However, the organisation said its forecast for 2024 had been downgraded by 0.7% to 1.951 million, which it said reflected cost of living concerns.
Reacting to the latest figures, SMMT chief executive Mike Hawes said that while the growth in EV registrations in particular was welcome, with an EV now being sold every 60 seconds on average, more support was needed to drive consumer demand for the vehicles.
He said: "The industry remains committed to meeting the UK's zero emission deadlines and continues to make the investments to get us there. Choice and innovation in the market are growing, so it's encouraging to see more people switching on to the benefits of driving electric.
"With inflation, rising costs of living and a zero-emission vehicle mandate that will dictate the market coming next year, however, consumers must be given every possible incentive to buy.
"The government must pull every lever, therefore, to make buying, running and, especially, charging an EV affordable and practical for every driver in every part of the country."
Reacting to the figures, Close Brothers Motor Finance director of sales Lisa Watson said: "Despite rising interest rates, high inflation and a bleak economic outlook, the new car market has continued to rally against these challenges. A further rise in July, making it a year of consecutive growth, offers a more positive outlook for the second half of 2023.
"With plans for London's Ultra Low Emission Zone set to press ahead, and with other cities in the UK likely to introduce similar schemes, it will be interesting to see if this has an effect on new registrations. Although our research found that two in three (66%) dealers said customers are being more cautious about purchasing vehicles, so the introduction of new schemes may make a new purchase a necessity."
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