The lure of new number plates failed to start a surge in new car sales last month.
Sales in March, with new 11-plate cars available, totalled 366,101 - a 7.9% dip on the March 2010 figure, the Society of Motor Manufacturers and Traders (SMMT) said.
The March 2010 total was boosted by the tail-end of the Government's car scrappage scheme.
The SMMT said last month's figures were better than expected and were almost 6% up on March 2010 if the scrappage volumes are excluded.
Sales have now fallen for nine successive months and the SMMT said today it expected new registrations to decline further during this spring before recovering in the second half of the year.
Sales for the first three months of this year are down 8.7% at 558,336.
The total for 2011 is likely to be around 1.93 million cars, which would represent a dip of 5% on the scrappage-boosted year of 2010.
Between 2004 and 2008, March sales averaged almost 450,000 units and annual totals were above 2.4 million.
Average new car emissions for the first three months of this year were the lowest ever at 140.3gms per kilometre - a 3.4% fall on the January-March 2010 figure.
SMMT chief executive Paul Everitt said today: "The March 2011 figures demonstrate sustained demand in what is traditionally the biggest month of the year.
"Despite a dip versus 2010, the market remains on course to meet our forecast for the year, with motorists buying increasingly fuel-efficient and low-emitting vehicles across every segment."
Diesel car sales rose by 7.9% in the first three months of this year, with diesel's share of the market rising from 41.1% to 48.5%.
Alternatively-fuelled cars achieved a record 1.4% share of the total market in the first three months of this year, having risen 27.3%.
These were the top-selling models in March 2011:
1. Ford Fiesta
2. Ford Focus
3. Vauxhall Corsa
4. Vauxhall Astra
5. Volkswagen Golf
6. Vauxhall Insignia
7. Volkswagen Polo
8. Peugeot 207
10. BMW 3 Series