Sales confound motor trade group predictions that surge in new car registrations would cool amid rise in import prices.
The number of new cars registered in the UK hit a 12-year high in January, with electric vehicles taking a record share of the market, according to the Society of Motor Manufacturers and Traders (SMMT).
The industry body had warned of a slowdown in the motor trade in 2017 because of the impact of the weak pound, but there was no sign of deceleration in the first monthly numbers of the year.
Drivers registered 174,564 cars in January, up 2.9% on last year, to reach the highest monthly level since 2005, the trade body said.
Alternative fuel vehicles, mainly electric cars, such as the Nissan Leaf, increased by a fifth to reach a record 4.2% share of new vehicle registrations, beating a previous high of 3.6% in November last year.
Petrol cars were also up strongly, gaining 8.9%, with diesel car registrations down 4.3%, continuing the fall seen in December, amid suggestions of higher taxes to curb emissions.
The SMMT chief executive, Mike Hawes, said he expected some “cooling” in the car market as the year progressed. However, he adopted a more upbeat tone than at the end of 2016, when he warned of a “challenging” 2017, with the weakness of the pound likely to increase the cost of imported parts, pushing up car prices.
He said January’s numbers were “buoyed by a great range of new models which are safer and cleaner than ever before”.
He added: “It’s encouraging to see alternatively fuelled vehicles benefiting from this positive growth, reaching a record market share.
“After record growth in 2016, some cooling is anticipated over the coming months, but provided interest rates remain low and the economy stable, the market is in a good position to withstand its short-term challenges.”
The Ford Fiesta remains the UK’s most popular car, followed by the Volkswagen Golf and Ford Focus.