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, Rupert Pontin, director of valuations at Glass's, said: “The May new car registration results show a consistent market increase more in line with the level that Glass’s expect for the time of year. A 2.5% uplift suggests that we are experiencing a normal level of demand without the excessive pre-registration activity that we experienced earlier in the year. The increase is focused on the fleet sector which means that despite some concerns driven by the world economic position and a general lack of major investment in new initiatives, renewal of company fleets is still a priority.

“There is little doubt that the EU Referendum is having an impact on the car market as a whole, and consideration must also be given to the fact that Euro 2016 starts in a matter of days which means that June figures may be lower than expected. There are certainly plenty of distractions for the retail buyer at the moment.”