UK car registrations in March rose 3.1% year on year to 449,287 units which, The Society of Motor Manufacturers and Traders (SMMT) said, was the second-highest for the month since the switch to twice-yearly registration plate changes in 1999.

Diesel car sales rose 7.8% in the first quarter to 264,186 units while sales of B-segment supermini models rose 6.6%.

“Growth in diesel and supermini cars shows that fuel efficiency and greener motoring are now critical concerns for buyers,’ said SMMT chief executive Christopher Macgowan.

“The industry has been working hard to improve its environmental profile too. CO2 from tailpipes has reduced dramatically across all bar one of the sales segments since 1997 showing a net 12% reduction of CO2 across the whole market. The recent Department for Transport ‘Act on CO2’ consumer campaign is a welcome further step in a more integrated approach to sustainable motoring.”

First quarter car sales rose 2.9% to 688,476 and the SMMT is forecasting full-year sales off 1.3% to 2,315,000 but plans to review that this month following the better than expected March results.

“The March growth reflected increased marketing activity by manufacturers, with 0% finance and free insurance deals enticing motorists into showrooms,” the SMMT said

“March accounted for 70% of quarter one’s growth, with volumes exceeding expectations by some 20,000 units. The market was up 2.9% or 19,270 units on the 2006 quarter one total.

The industry group said all sales categories posted growth in March. The fleet and business sectors recorded the best gains, but private demand was also up by 1.5%.

“Private demand has fallen by almost 20% since its peak in 2003 and significant overall market recovery will need the private sector to show sustained growth.”

In the first quarter of the year fleet/business volumes represented 54.4% of the market, up from 53.3% a year ago.

Ford’s C-segment Focus was top-selling car in the UK both for March and the first quarter.

“Spring has come right on time for car dealers, with March’s surprisingly strong sales figures an unexpected gift for Easter,” said Sue Robinson, director of the RMI National Franchised Dealers Association (NFDA), part of the Retail Motor Industry Federation (RMIF).

Robinson said the March sales figures “are extremely welcome although it would be imprudent for businesses to expect 2007 to be a boom year based on one month of strong sales. Since the industry moved to a twice yearly plate change, there has been an increasing trend for March sales to grow at the expense of September.”

She added: “We have seen a consumer slowdown through the last few quarters, and we have yet to see the impact of the Chancellor’s [finance minister] budget, which occurred mid-month. Therefore we will wait and see if the next few months provide equally good news.”