According to new data from the Society of Motor Manufacturers and Traders (SMMT), fleet registrations declined 3.1% to 70,448 units while the sub-25 business sector fell 11.1% to 6,793 units. However, it was the retail sector that recorded the sharpest decline, down 20.8%.

Fleet registrations now account for 54.7% of total sales – up from 50.0% for the same month last year – while the marketshare for small businesses remains static at 5.3%.

Overall, the new car market fell 11.5%, marking the seventh consecutive month of decline.

The SMMT said that this was in line with its forecasts and marks the beginning of a challenging year for the UK motor industry.

Chief executive Paul Everitt said: 'Consumer confidence is low and it is important that government uses the March Budget to help relieve some of the financial pressure on motorists by freezing fuel duty, while providing stability and certainty on motoring taxes. Despite the challenging conditions, the demand for low CO2-emitting and highly fuel-efficient cars continues to grow.'

David Raistrick, UK manufacturing leader at Deloitte, commented: '2011 will be tough for motor manufacturers. We do not expect sales to go beyond 1.9 million and they may struggle even to reach 1.85 million, which would be one of the lowest new vehicle sales years in the last decade. Public sector buying is reducing and private consumers are keeping their cars for longer. The real acid test will be the March registrations, but there are no early signs of these providing the required boost.'

He added: 'The very low registrations we have seen in recent years means that as the year progresses the residual value of cars will hold up well. Coupled with new car sales being limited, this will lead to a buyer’s market for those wishing to sell their three year old cars for new ones, with good deals on both new cars and part-exchange prices.'