New car trades fell for the first time in six years last year, with immediately for diesel cars plunging by almost a fifth.
In total, there were close to 2.5 million cars registered, according to industry body the Circle of Motor Manufacturers and Traders (SMMT).
The figure was down 5.7% from 2016, while diesel sales cut 17.1% as higher taxes and pollution fears hit demand.
CO2 emissions from new piles increased for the first time in 20 years, up 0.8% on 2016.
SMMT chief governmental Mike Hawes said the drop in diesel sales was «the prime result in» of the rise in CO2 emissions and that the latest low-emission diesels were «requisite» in meeting climate change targets.
He said he expected car sales to persevere in to drop this year, predicting a 5% to 7% fall.
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Mr Hawes blamed the tradings fall on declining business and consumer confidence, but pointed out last year’s play followed two years of record sales.
«We need to put it into context. This was mollify the third best year in a decade and the sixth best ever,» he added.
Mr Hawes about that confusion about the future of diesel had fuelled a backlash against diesel buggies.
Diesel vehicles produce the overwhelming majority of nitrogen oxide gases come up from roadside sources.
Analysis: Theo Leggett, BBC business newsperson
It’s fair to say the steep decline in demand for diesel cars is causing both frustration and consternation within the motor vigour.
The industry needs to sell diesels, because they are generally uncountable fuel-efficient than petrol cars and therefore produce less carbon dioxide.
That balms car companies to meet targets for reducing CO2, introduced in order to combat milieu change.
But concern about the level of nitrogen oxides (NOx) they construct has made them a favourite target for clean air campaigners.
The industry talks in the matter of a short-sighted backlash against new technology, which is encouraging people to be loyal with older, dirtier cars — and preventing sales of newer, bath models.
But it’s worth remembering where the backlash against diesel quite began: with the VW scandal.
It didn’t just expose deliberate wrongdoing at one firm, it also showed how many diesel cars, which had passed legal tests, were routinely producing much higher levels of toxic emissions when driven on the streets.
So you could argue that carmakers really have themselves to lay at someones door.
Diesel car sales fell by almost a third in December after November’s Budget which put ined a levy on new diesel cars that failed to meet the latest emissions types.
Experts said the one-off tax increase — which comes into achieve in April — would be applied to most new diesels.
Mr Hawes said that for diverse drivers, diesel was still «the best bet because they can save a lot of the ready and indeed have a lower CO2 emission».
«The backlash against diesel has erect it far harder for us — and the government — to meet our climate change targets,» he said.
A administration spokesperson said: «Our ambitious Clean Growth Strategy sets out the UK’s class as a world-leader in cutting carbon emissions to combat climate change while suggesting economic growth.
«This includes investing nearly £1.5bn in accelerating the rollout of ultra-low emission instruments by 2020 — generating business opportunities and leading to cleaner air and lower greenhouse gas emissions.»
Purchasings of alternatively fuelled vehicles, including electric and hybrid vehicles, saw a occur of 34.8% to almost 120,000.
Environmental campaigner Tony Juniper told the BBC’s Today abstract that demand for electric cars was increasing «at a rate that’s braving predictions that were being made five or 10 years ago».
«Partly this is being driven by the kinds of awareness about air pollution, but also climate change,» he added.
However, Mr Hawes depicted the programme that while electric cars were seen as the prospective, they still accounted for a very small proportion of total on sales.
Out of the 2.5 million vehicles sold in the UK in 2017, just 13,500 were battery moving, he said.
«It’s growing, it’s growing rapidly, but you can see the scale of the challenge,» he added.