There were 243,479 new cars registered overall last month, according to new figures from the Society of Motor Manufacturers and Traders (SMMT). That is down 14.3 per cent compared with March 2021.
It is the lowest March total since 1998, which was prior to the introduction of new number plates every March and September.
A Scottish breakout showed that 21,069 cars were registered last month, a less drastic year-on-year fall of 7.5 per cent.
SMMT chief executive Mike Hawes described the figures as “deeply disappointing”, with March crucial for the industry because it is normally the busiest month of the year as buyers demand the latest number plate.
He said: “While demand remains robust, this decline illustrates the severity of the global semiconductor shortage, as manufacturers strive to deliver the latest, lowest emission vehicles to eagerly awaiting customers.
“Placing orders now will be beneficial for those looking to take advantage of incentives and lower running costs for electric vehicles, especially as the Ukraine crisis could affect supply still further.
“With increasing household and business costs, government must do all it can to support consumers so that the growth of electric vehicles can be sustained and the UK's ambitious net zero timetable delivered.”
The UK has pledged to reach net zero for carbon emissions by 2050. To help achieve this, sales of new cars and vans powered purely by petrol and diesel will be banned from 2030.
A record 64,165 battery electric vehicles (BEVs) were registered in March, the latest figures revealed. That is up 78.7 per cent on the same month in 2021, taking a 16.1 per cent market share.
More BEVs were registered last month than during the whole of 2019.
Sean Kemple, managing director at Close Brothers Motor Finance, said: “Dealers will no doubt come up against some road blocks in the next few months due to the domino effect of production issues.
“There is a severe lack of materials available; rare commodities such as aluminium, nickel and copper, all of which are crucial for the manufacturing of semi-conductors, are in incredibly short supply. This is a huge blow for the industry, which was just starting the journey to recovery following pandemic-related bottlenecks.
“With petrol pump prices skyrocketing and the cost of living soaring, some consumers may struggle with the costs of running traditional vehicles.”
John Wilmot, chief executive of car leasing comparison website LeaseLoco, said: “Fuelled by the high cost of diesel and petrol at the pumps, Tesla powered to the top of the best seller chart in March, filling the top two spots.
“For the first time ever, the two best selling cars were electric last month. As the electric car revolution gathers pace this is likely to become commonplace as more people have the confidence to switch.”
Founder and chief executive of Electrifying.com, Ginny Buckley, added: “These stats prove the electric revolution is happening right now and that consumers are leading the switch. While the surge in demand for electric cars is welcome news, it’s led to delays for many drivers who are keen to make the switch immediately.”