New models from Nissan (Qashqai) and BMW's Mini (redesigned hatchback) helped boost UK car production by 12% in March to 142,158 units.
The upturn saw first quarter production increase 2.9% to nearly 405,000 units after a markedly slow start to the year.
Nearly 80% of the cars built in the UK in March were exported.
"The 12% growth in UK car production in March is a significant step forward after a period of product changes at the start to the year," said Mike Hawes, SMMT chief executive.
"After several years in the doldrums, European demand for new cars is now picking up with growth in the last seven months. This is a welcome boost for the UK's volume manufacturers for whom Europe is the key market. As new models are launched and investments realised, the sector remains on course for record levels of output by 2017."
March also saw an improvement in engine output which grew 4.5% to almost 230,000 units. Production for export rose 9.5% last month, offsetting a 3.6% domestic market decline. The improvement in March took Q1 production to 651,255 units, down 1.3%.