New car registrations failed to recover in the key September sales month with 4.4 percent fewer cars leaving retailer showrooms than the previous year.
This takes registrations down to a level last seen in 1999.
September 2020 registrations were almost 16 percent lower than the 10-year average for the month.
The Society of Motor Manufacturers and Traders now warns the UK automotive industry is facing lost revenue of more than £21 billion by the end of 2020.
More than 615,000 fewer new cars have been registered so far this year compared to 2019.
“During a torrid year, the automotive industry has demonstrated incredible resilience, but this is not a recovery,” said SMMT chief executive Mike Hawes.
“Despite the boost of a new registration plate, new model introductions and attractive offers, this is still the poorest September since the two-plate system was introduced in 1999.
“Unless the pandemic is controlled and economy-wide consumer and business confidence rebuilt, the short-term future looks very challenging indeed.”
100% zero emissions electric cars were a rare highlight. Almost 22,000 were registered in September alone: a 184 percent increase on 2019.
Pure electric cars took a 6.7 percent market share. Almost 67,000 battery electric cars have now been sold so far in 2020.
“It is the first time more than 20,000 new electric cars have been registered in a single month,” said automotive analyst Matthias Schmidt.
“This has been driven by the Benefit in Kind change earlier this year, the registration plate changeover, the arrival of new models and Tesla’s end-of-quarter push.”
Add in plug-in hybrids, said Mr Schmidt, and every 1 in 10 vehicles registered in the UK last month was a plug-in.
Top 10 best selling cars: September 2020
1: Vauxhall Corsa
2: Ford Fiesta
3: Mercedes-Benz A-Class
4: Volkswagen Polo
5: Volkswagen Golf
6: Nissan Qashqai
7: Ford Puma
9: Volvo XC40
10: Ford Focus