The Society of Motor Manufacturers and Traders (SMMT) increased its forecast for new car registrations following a 12.7 per cent year on year rise in new car sales.
The SMMT now predict car registrations for 2013 will reach 2.216 million units, an 8.4 per cent increase over the 2012 figure.
Strong sales across private, fleet and business helped create 162,228 new car purchases last month, making July the 17th successive monthly rise in new car registrations.
"Recently, we've seen a range of economic indicators point to improving conditions and our raised sales forecast emphasises how positively we view the rest of 2013,” said Mike Baunton, SMMT Interim Chief Executive.
Registrations of alternatively-fuelled vehicles grew 17 per cent in July, with plug-in car registrations continuing to fuel the increase. Since the start of 2013 electric and plug-in hybrid registrations have soared by 70.7 per cent, with total sales reaching 1,885. The SMMT says the growth has been fuelled by an increase in the availability of products across the UK and the tax breaks offered to motorists who reduce their CO2 emissions.
Diesel and petrol powered cars continue to have a virtually equal share of the market, with 50.7 per cent and 47.8 per cent respectively.