UK car production declined in September but the decline was the smallest in the past 12 months.

Figures compiled by the Society of Motor Manufacturers & Traders revealed that the number of cars produced in UK in September was 119,616, representing a decline of 16.1 per cent from September 2008.

The decline was small as compared with a drop of 31.5 per cent in August from a year earlier.

The scrappage scheme, which provides a subsidy of £2,000 on the purchase of a new car, has encouraged the sale of new cars.

Workers at Vauxhall's Ellesmere Port and Luton plants have hit a deal with their new owner, the Canadian car parts manufacturer Magna International, in a move that will secure the future of around 5,000 UK workers.

Under the deal the workers have agreed to a two-year pay freeze and 600 voluntary job redundancies.

The union said the deal secured the plants' future.

Vauxhall said in a statement, "We are pleased that the parties have secured an agreement that protects the jobs and prospects of the 5,000 Vauxhall staff in the UK."

The MINI E, an electric car that costs a penny to travel a mile, is going to be trialed across the southeast.

BMW has selected 20 lucky people from the public who will use the battery-powered MINI Es for a period of six-months on a £330 a month leasing deal.

The drivers are supposed to drive at least 300 miles a month and the company will monitor their driving and charging habits.

The MINI E is a part of a larger BMW program, named Project I, which aims at producing zero emission, fuel efficient cars by 2015.

Britain witnessed an increase of 11.4 per cent in the sales of new cars in September, signifying the recovery of the motor industry from recession.

Government's scrappage scheme, under which car-buyers receive a discount of £2,000 when they scrap their more than 10-year old vehicle to buy a new one, pushed the number of new car registration to 367,929.

The Society of Motor Manufacturers & Traders said that the Ford Fiesta was the best-selling car during the month of September.

The Car scrappage scheme aimed to crush cars up to ten years old for a £2,000 subsidy gets yet another extension, with funds worth £100 million being injected into the scheme. The scheme was introduced in May and will continue until February or till the disbursement of planned £300 million subsidy for purchasing new cars.

Ford Motor Co. said announced on Friday its plan to spend $490 million on building a third assembly plant in China in a move that will help the company in improving its performance in the world's strongest market.

The US automaker will run the new plant with its Chinese partner Chongqing Changan Automobile co. and Japan's Mazda Motor Corp.

Michigan-based Ford has already two plants in China, one in Chongqing and another in Nanjing.