Carbon dioxide emissions resulting from transport are still declining, but at a slower rate, according to a new report from the Society of Motor Manufacturers and Traders (SMMT) - although diesels have played a key role in cutting the level of emissions.

The fourth annual report by the group shows that annual average new car CO2 emissions have improved each year, with 2004 showing a 0.4 per cent improvement over the 2003 level.

A continued shift to diesels is cited as a key factor in the overall improvement in emissions, with diesels accounting for 32.5 per cent of the UK market in 2004.

However the report says that the pace of improvement has been "tempered" by a shift in the marketplace away from smaller CO2-efficient models.

Sales of four-wheel drive cars reportedly increased by 13 per cent last year, with 179,000 models sold in the UK.

While Europe has led the way in the diesel sector, the US market has also recently shown signs of enthusiasm for diesel-powered cars.

Improvements in diesel technology and the introduction of increasingly stringent fuel efficiency policies have slowly begun to impact on consumer choice in the market.

Every major car maker now has a diesel engine development policy for the US market, which spells good news for the platinum industry as the metal is used in autocatalysts to control harmful emissions.