Manufacturers and dealers have rejected claims they are openly breaking strict rules on vehicle supply laid out in the Supply of New Cars Order 2000.

Cap Network national research manager Martin Ward has alleged that franchised dealers are pre-registering cars to boost their sales targets and damaging the used car market in the process.

Since the order was published, manufacturers have had to provide detailed lists of vehicles they have pre-registered. But the total number of pre-registrations has only been in the hundreds since the totals began to be provided, despite allegations that the true figures could be as high as 500,000.

Manufacturers have been accused of massaging the figures after large tranches of sales regularly appeared on the last day of the month, when dealers had to hit their targets.

In November last year, manufacturers were accused of prolonging the agony of falling residual values and chronic oversupply in the market. Mr Ward said: “Most dealers are given a target to reach from January 1 through to March 31, with a bonus being paid on reaching the target. There is nothing new in this - it has gone on for years.

“It is true that many dealers are replacing courtesy cars and demonstrators with these vehicles, but some are simply contravening the order. The most worrying thing is that it is not only franchised dealers offering these cars. Others are buying them direct from main dealers and putting them on their used car lots alongside their general stock. This will do nothing to help the used car market's return to stability.”

The Society of Motor Manufacturers and Traders fended off any suggestion the figures supplied were not correct. A spokesman said: “The Office of Fair Trading has looked at all aspects of the Government's order and they have found that everyone is complying with it.”

Alan Pulham, franchised dealer director of the Retail Motor Industry Federation, said: “The number involved is very small, because manufacturers are not allowed to provide an incentive for pre-registering vehicles, so there is no reason for dealers to do it.”