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The UK new car market is set to see many more sales in 2023 than previously forecast, according to Cox Automotive.
The data firm said its baseline forecast - the most likely scenario - for the year was now for 1,942,667 new car registrations - a 13.5% increase compared with its previous prediction, issued three months ago.
It said overall market sentiment had been boosted by a "surprisingly strong" performance in 2022, and by Q1 of 2023 continuing this positive trend.
As for the used car market, it continues to predict 7,096,932 transactions, which would be a 3.2% year-on-year improvement.
Cox Automotive insight and strategy director Philip Nothard said: "It's heartening to once again unveil an upbeat sector forecast. So many challenges that have dominated our commentary on new and used markets for successive quarters are finally fading.
"That's not to say that the road ahead is free from obstacles and the visibility is crystal clear, but we progress towards the halfway point of 2023 in a better position than many dared hope."
Nothard said the revised new market forecast reflected confirmation of 2022's registration figures, and evidence gathered during the first quarter of this year that manufacturers were returning to a 'push' market.
He said: "More than 85 million cars and LCVs were manufactured in 2022, a 6.08% year-on-year increase and a drastic improvement on the lows of 77 million seen in 2020.
"With supply chains now approaching where they need to be, manufacturers can once again ramp up production and define the volume of vehicles that are supplied to the market, as opposed to the demand-driven 'pull' market we've experienced since the first lockdown."
Cox's forecast is also said to account for the sector having a clearer picture of what it said were the two most influential dynamics within the market - the influence of EVs, and the emergence of new Chinese brands.
Regarding the used market, Nothard said: "We've reviewed all the relevant data points and remain confident in our existing forecasts. It would be understandable to look at what's happening with new registrations and conclude that this performance will naturally translate over to the used market.
"Still, we must remember that most of today's new vehicles will not be seen in the used market until 2026, and possibly longer still if predictions of fleets and private buyers retaining vehicles for longer prove to be accurate.
"We must also remember that the used market continues to be impacted by huge volume lost over the past three years; some 42 million fewer vehicles were made globally in this period compared to the previous three years. This equates to 2.3 million vehicles that should've entered the UK's used market around now but never did.
"Nevertheless, the fact that we're looking at completing more than seven million used car transactions this year is a very positive position to be in."
The updated forecasts have been published in Cox's AutoFocus newsletter.
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