According to newly released data from the SMMT, registrations within the fleet sector reached a total of 35,540 in February, up 4.3% on the figure of 34,074 recorded for the same month in 2009. The improvement was more pronounced amongst small businesses, with registrations up 9.6% to 2,348, compared to 2,143 in February 2009.

However, the industry cannot afford to take its eye off the ball, according to the SMMT, which urged the Government to defer the new car VED rise and boost business confidence post-scrappage.

The SMMT's chief executive, Paul Everitt, commented: 'Industry continues to face challenging market conditions, but positive trends in the fleet and business sectors suggest that negative impacts can be minimised. Strengthening business and consumer confidence remains industry's priority. A clear and consistent approach to CO2-based taxation and improved access to affordable credit are essential elements in sustaining recovery in the new car market.'

As the UK enters its final month of the scrappage scheme, the continued effects of the scheme on retail sales were evident. A total of 19.6% of registrations in February were accounted for by the scheme, lifting the overall car market up by 26.4% last month to a total of 68,686 units.

'Scrappage has generated eight consecutive months of growth in the new car market and we expect its benefits to stretch beyond the scheme’s closure later this month,' commented Mr Everitt.

However, the outlook for overall registrations in 2010 is subdued and cautious, said the SMMT. Although new car demand will be building up, after a sustained period of hold-off, factors such as the fragility of the economic recovery and uncertainty over the impacts of the Budget in March and a general election in the spring mean that registrations are expected to decline by almost 10% to 1.82 million units.