London: British new car registrations had their strongest September in 10 years, boosted by confidence in the economic recovery, the Society of Motor Manufacturers and Traders said on Monday.

Sales rose by 5.6 percent compared with September of last year to hit 425,861 new car units, the 31st consecutive month of growth, industry body the SMMT said.

Figures are typically strong in March and September when Britain introduces new registration plates, with the SMMT saying the new series was one of several factors to push up figures.

Britain is on track for a total of 2.45 million new car registrations in 2014, which would be the highest level recorded since 2004.

Cheap finance

Cheap finance, helped by record-low interest rates, has pushed up car sales since the 2008-09 financial crisis which saw levels nose-dive and the government intervene to support the industry with a scrappage scheme.

Up to 80 percent of new-car purchases are now made on credit with many customers effectively renting a new car - typically for three years - before trading it in for a new model using a scheme known as a personal contract plan (PCP).

But there are signs Britain's buoyant car market is beginning to cool with year-on-year sales growing by 18 percent in March, the last time new registration plates were brought in, three times as much as September’s more moderate rate of growth.

Car sales were one of the first areas of British consumer demand to recover after the economic downturn.

Ford's Fiesta supermini held on as Britain's top-selling car, SMMT data showed, followed by its mid-sized Focus model and the Vauxhall Corsa.

Bright spot

The UK has been one of the few bright spots for global carmakers in Europe. Continent-wide sales still lie 20 per cent off 2007 levels.

Registrations for the first nine months of the year are now at almost 2m, up 9 per cent on the first three quarters of last year, according to the Society of Motor Manufacturers and Traders, the industry body.

Mike Hawes, SMMT chief executive, said September's performance was particularly strong given the context of "bumper" volumes in the same month last year.

September is one of the most important months for the industry as it sees the release of new registration plates and tests consumer appetite for the latest vehicles.

September and March - when the first yearly plate change comes in - together account for a third of annual registrations.