New-car sales in the UK rose by 7 percent to 172,907 in July, as the country's credit-backed growth continued.
July's increase was the 29th consecutive month of growth and brought sales for the first seven months to 1.5 million units, an increase of 10 percent on the corresponding period last year.
Although the rate of growth last month was slightly lower than in June, so far this year the market has been more buoyant than expected by the UK's Society of Motor Manufacturers and Traders (SMMT)
The SMMT revised its full-year forecast to 2.5 million units, a gain of 8 percent on 2013. It had previously been predicting 6 percent growth.
UK sales have been helped by improving economic confidence and low interest rates. About four out of every five new cars sold in the UK are now financed through credit, with many customers effectively renting a new car - typically for three years - before trading the vehicle in for a new model using a scheme known as a personal contract plan.
The improved July sales trend in the UK has been mirrored in other major European markets. Sales in Germany, the region's largest auto market, rose 7 percent to 270,249 units last month, helping to lift sales for the first seven months by 3 percent to 1.8 million units. Sales in Italy rose 5 percent to 113,777 vehicles in July, while in Spain sales rose by 11 percent to 83,223. Sales in Spain continue to benefit from a generous government scrappage scheme.
Against the positive trend, in France car sales fell 4 percent to 143,777 units in July, paring back year-to-date gains to 2 percent. Domestic carmakers Renault and PSA/Peugeot-Citroen were both hit by a fall in monthly deliveries.
According to Francois Roudier, spokesman for French industry body CCFA, "There are still concerns weighing on consumers and companies that do not favor new vehicle purchases." However, CCFA still expects sales for the full year will be 2 percent to 3 percent up on 2013. At 1.3 million units, sales in the first seven months were up nearly 2 percent on the corresponding period last year.
Commenting on the latest monthly data, Jonathon Poskitt, head of European forecasting for LMC Automotive, told Automotive News Europe that July was another positive month for Europe as a whole.