Of the 158,082 sales last month, 21.6% were attributable to the car scrappage scheme, which is due to end in February or when funds run out, whichever is sooner.

CEO of the Society of Motor Manufacturers and Traders (SMMT) Paul Everitt, said: “The increase in new car registrations in November reflects the positive impact of the scrappage incentive scheme, customers avoiding the VAT increase in January and the very difficult conditions that we experienced a year ago.”

After Business Secretary Lord Mandelson said last week that the industry would have to cope with returning to normal market conditions, Everitt urged the Government to consider extending the scheme in its Pre-Budget report on Wednesday, noting that there was just an estimated £125m of funding remaining.

The November figures took new vehicle sales to more than 1.84m for the first 11 months of year, but this represents a drop of 8.8% on the same period last year. Full year estimates are for 1.95m sales versus 2.13m in 2008.

RAC motorist strategist Adrian Tink said: “We are still concerned about what will happen once the scheme ends and the discount bubble burst.” 

Edmund King, president of the AA noted of the new cars purchased through the scheme: “These cars are cleaner, greener and safer”, whilst making reference to a recent poll suggesting 13% of drivers would consider buying a new car if the scheme was extended.

UK manufacturing leader at Deloitte, David Raistrick said: “We may see interest rates increase next year. Furthermore, car manufacturers may find themselves needing to implement price rises due to the low value of sterling increasing the cost of imported cars and parts. The automotive sector must be prepared to deal with these challenges in order to ensure a long-lasting recovery.”