Following the trend set in the previous two months, an 8.8% rise in fleet registrations helped offset a -3.0% fall in registrations to private customers and a 20.2% decline in the sub-25 business sector. As a result, May saw a steady 2.5% growth in registrations.

With 203,585 cars registered in the month, the total marked the highest for May since 2002. However, the SMMT noted a continued easing of growth, being the second consecutive month of sub-3% growth in registrations.

Mike Hawes, SMMT chief executive, said: “The new car market in May remained high with compelling offers available on the latest vehicles, but the low growth is further evidence of the market cooling in the face of concerns around economic and political stability. Whether this is the result of some buyers holding off until the current uncertainty is resolved or a sign of a more stable market for new cars remains to be seen.”

Demand for diesel cars grew 5.0% in May, outstripping that for petrol models, which saw a marginal decline of -0.6%. Uptake of alternatively fuelled vehicles, meanwhile, continued to outpace the overall market with registrations increasing by 12.1%.

Year to date, a total of 1,164,870 cars have now been registered in 2016 – 4.1% ahead of the same period last year. The fleet market is up 4.8% to 575,193 units while the business market has risen 6.1% to 43,881 units. Private registrations are up 3.2% for the first five months of the year to 545,796 units.

Commenting on the figures, John Leech, head of automotive at KPMG UK, said: “This is the third month that consumer demand has softened and signals that the top of the market has been reached for consumers following 2015’s all-time record sales.  Sterling has weakened by 11% since November 2015 due to Brexit fears but so far this has not translated into transaction prices as manufacturers anticipate this is a short-term fluctuation. Cheap PCP car finance offered by manufacturers remains widely available and with renewals rising, it is unlikely that we will see consumer demand soften substantially further this year.

“Fleet sales are unlikely to keep up their current pace of growth for long however it is likely that the total UK car market will plateau in the second half of 2016.”