Demand remains strong for large vehicles such as coaches and buses, according to the latest figures.

The Society of Motor Manufacturers and Traders (SMMT) revealed that new registrations had been better than expected during March.

Large coaches and large buses beat expectations, while midi-buses also saw strong growth.

Mini-bus registrations showed signs of softening, but the SMMT put this down to changes in the licensing arrangements.

"Unexpectedly good registration figures for big buses, big coaches and midi buses are encouraging," said Paul Everitt, SMMT chief executive.

"While mini bus registrations may be suffering the effects of driver licence changes, overall the bus and coach sector's performance and manufacturers' strong order books reflect cautions optimism."

These positive figures come against the backdrop of a slowing economy.

The rising cost of living and the credit crunch are likely to stymie growth this year, with business activity expected to be subdued.

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