The number of cars made in the UK reached a 17-year high last year, according to the industry's trade body.
The Society of Motor Manufacturers and Traders (SMMT) added that exports rose 10.3% to 1.35 million vehicles, a record for the second consecutive year.
But SMMT head Mike Hawes repeated fears that investment would suffer without a suitable post-Brexit EU trade deal.
Mr Hawes said that car production was on course to reach an all-time high before 2020. But the SMMT's statement sounded a note of caution after revealing that investment by the industry fell to £1.66bn last year, compared with about £2.5bn in recent years.
On Tuesday, Mr Hawes told MPs on the Treasury Committee that many carmakers are putting off investment until there is more clarity over the UK's trade relations with the EU.
'Red line'
Mr Hawes said: "Significant investment in new plants and products over the past few years has driven this growth, not a post-Brexit bounce."We want trade deals but they must be the right deals, not rushed deals. Failure to do so could damage UK automotive manufacturing beyond repair."
The imposition of tariffs would be "a red line for the industry," he said. "There would be an impact on demand and jobs - that's a cliff edge we want to avoid."
However, Business Secretary Greg Clark insisted the car industry would thrive, saying: "Our modern industrial strategy will make the UK one of the most competitive places in the world to grow a business and these figures show why the UK automotive sector has such a vital role to play as we build on our strengths and extend excellence into the future."
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