The slump in car production in the UK is showing signs of bottoming out, according to new data released this morning by trade body the SMMT.

Manufacturers made 16% fewer cars last month than the previous year, the slowest rate of decline for a year.

British motorists are also buying far more cars rolling off production lines, thanks mainly to the scrappage scheme, which was extended last month into next year.

The number of cars exported last month fell by almost a third, with those manufactured for the domestic market increasing by an even larger amount compared to September last year.

But production of commercial vehicles, mainly vans, continued the steep downward descent. Just over 9,000 vehicles were made last month, half the figure in the same period last year.

Paul Everitt, SMMT chief executive, said: "The UK economy is slowly emerging from recession, but businesses remain reluctant to commit to large capital investments and this is reflected in low demand for commercial vehicles."