The new car market remained stuck in reverse in January with sales slumping to a 14-year low.
R egistrations totalled 157,363 last month, a 13.3 per cent fall on the same month last year and the lowest since January 1992,
Figures were more than 32,000, or 17 per cent, below the January average between 1999 and 2005, industry body, the Society of Motor Manufacturers and Traders said yesterday.
Last month's slump followed a five per cent fall in the new car market in 2005 caused by the slowdown in consumer spending.
But December's figures were skewed by a big increase in sales of diesels to company users rushing to beat the deadline for the ending of a three per cent tax break on low emission vehicles.
That had a knock-on effect on January's sales figures, the SMMT said in response to yesterday's figures.
They showed "the effect on a market when tax changes are not carefully considered", SMMT chief executive Christopher Macgowan said.
"Many company car drivers rushed to take advantage of the three per cent tax benefit at the end of 2005. This led to the record diesel registrations in December and the weaker January market."
Despite the fall, the UK remains Europe's second biggest car market after Germany.
Annualised sales peaked at 2.6 million in March 2004 and have drifted steadily since as economic uncertainty and rising interest rates put the brakes on demand.
The new car market is f orecast to fall from 2.44 million last year to 2.375 million this year and 2.33 million in 2007.
Sales slipped in all categories in January, but the private sector recorded its first increase in market share since last August, inching up to 40.2 per cent from 38.4 per cent.
Among Midland manufacturers, Land Rover showed a four per cent sales gain last month at 3,282 as it continued to benefit from the popularity of new models, including the Range Rover Sport.
Jaguar began the year with a 17 per cent fall to 1,409 units, but is looking to the new XK sports car to boost figures when it arrives in the showrooms in March.
Sales of Mini, which BMW builds at Oxford, took a 51 per cent hit, falling to 1,458. But that was because of production cuts to accommodate work on expanding the Oxford plant as part of BMW's £100 million investment in developing the brand, a spokeswoman said.
Toyota, which builds European market cars at Burnaston near Derby, saw sales fall by 27 per cent to 7,346; Peugeot, with a Ryton factory near Coventry, was three per cent adrift at 11,199.
Aston Martin sales rose by 77 per cent to 227.