Car buyers stayed away from the showrooms during August and new car sales totalled just 63,225 - 14,000 fewer than in the same month last year.
Sales of newly registered 58-plate models in September are likely follow suit and fall by around 30,000 units from 419,000 units in 2007.
Paul Everitt, chief executive of the Society of Motor Manufacturers and Traders (SMMT), said: "The slow-down in the UK mirrors the difficult conditions being experienced across the main European markets.
"There is a clear need for sustained action by government to boost the economy and restore confidence."
The SMMT claims that these figures make this August the worst since 1966. However, August is one of the weakest months for car registrations, typically amounting to just three per cent of annual sales. This has been the case since 1998 when the UK switched from a single registration plate change in August, to having two every year in March and September. The figures are used slightly out of context as August used was the strongest month for car sales for many years because it was the plate change month. It guaranteed strong sales even in years of recession. So reports of this August being the worst car sales month for 40 years, although technically correct, are slightly wide of the mark.
However, those car makers that specialise in 4x4s and prestige models have suffered a huge drop in sales. Bentley spokesman, Mike Hawes, confirmed that it would be cutting production on its entire Continental line by 15 per cent, after a fall in global sales over the last 18 months and workers would be going on a three-day week.
Despite the decline of the market, sales of small off-roaders have gone up, with buyers looking to save money with a smaller, low-emission car and cheaper fuel bills.
