New car registrations in the UK fell by 21.2 per cent in December, new figures revealed today, piling more pressure on the Government to deliver an aid package to Britain's struggling vehicle industry.

According to the Society of Motor Manufacturers and Traders (SMMT), the decline in new car registrations, which totalled 108,691 in December, is below November's steep fall of 36.8 per cent. The SMMT said the Government’s 2.5 per cent cut in VAT on December 1 may have enticed some buyers.

However, today's figures cap a dismal year for the industry, in which total new car registrations fell 11.3 per cent to 2.1 million units, down from 2.4 million in 2008.

The SMMT today repeated its call for action by the Government to help the UK car industry gain access to new funding.

Paul Everitt, chief executive at the SMMT, said: "The measures taken by Government to support the banking sector and kick-start demand have been necessary, but are not yet sufficient to restore confidence.

"Further action to ease access to finance and credit across the economy is essential if long-term damage to valuable industrial capability is to be avoided."

There had been hopes that the Government would deliver an aid package to the industry before Christmas.

There are growing concerns over the future of both component makers, hit by a lack of bank lending, and major manufacturers such as Jaguar Land Rover, the luxury car group owned by Tata, which has told the Government it is in need of credit urgently.

Mr Everitt predicted that 2009 will be another difficult year for the UK automotive industry with new vehicle registrations and production significantly reduced".

He said: "The industry faces these challenges stronger and more resilient than in recent memory. The extraordinary circumstances we currently face mean that government support will be required to take advantage of global economic growth when it returns.”

The Ford Fiesta was the most popular new car last month, selling 7,204 units, while Ford’s Focus model sold the most over the whole of 2008, selling 101,593 units.

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