UK year-to-date car registrations were up 2% to 1,267,299 units at the half-way point prompting an enthusiastic reaction from the ever-optimistic chief of automakers' trade group the Society of Motor Manufacturers and Traders (SMMT).
"At the half point of the year, June is traditionally the time to take stock of one's performance - and so far in 2007, things look encouraging,"' said SMMT CEO Christopher Macgowan, who departs at the end of the year.
"However, while total new car registrations for the first six months are up on the previous year, they are still below the average since we moved to the twice-yearly plate change. Cost-conscious motorists will surely have one eye on the showroom and the other on the Bank of England's rate announcement today."
The BoE on Thursday hiked interest rates to 5.75%, the highest in six years and the fifth increase since it started doing so last August.
Year-to-date diesel registrations rose 5.9% to 490,283 units while June new car sales were up 1.5% to 222,863 units.
The SMMT is concerned that interest rates will rise further this year.
"GDP growth and consumer spending has been resilient, but the effects of higher base rates will impact and are expected to offset the enticing deals and offers in showrooms in the second half of the year. SMMT is due to review its full year forecast later this month. It currently stands at 2.335mn units," the group said.
Private buyer demand rose in four of the first six months of the year, although net growth was marginal at 0.9%. Demand in June rose by over double that rate but at 2% was still modest.
Fleet/business demand has collectively improved by 3% over the first half of the year and their share of the market has risen from 54.9% a year ago to 55.4%.
The GM Europe Vauxhall Astra was the best selling model in the UK in June, for the first time since November 1998. Ford's Focus was knocked off the number one best seller's slot for the first time since September last year and for only the fourth time since May 2000.
Most market segments posted growth in June. Over the first half of the year the supermini (B-segment) market has grown the most up 5.3% or 20,763 units.
Diesel-engined registrations edged upwards in June and market share slipped marginally from 38.9% in June last year to 38.4%.
Over the first half of the year the market was still up 5.9%, or 27,516 units and share rose to 38.7% compared with 37.3% a year ago.
The Focus remains the best selling diesel model over the first half of the year, but BMW's 3-series took the top spot in June.