I am writing this guide just to provide a brief history of the car number plate and how the Cherished Number Plate Industry was born.
It all began in 1903 when the Motor Car Act was introduced. It said that every car had to be registered with a county council or a county borough council, and every car had to display a unique identifying number issued to them by such a council. Earl Russell camped outside of  his local registered office to secure the number plate A1 (issued by London County Council) for his vehicle.
B1, C1, AB 1, AC 1 etc followed and the sequence was carried through until the first 3 letters 3 numbers format was introduced in the 1930’s.
In time the single and double digits were reversed, for example D in 1964 and AD in 1960 although they never reversed the A letter. By the mid 1950s all the 3 letters 3 numbers combinations had been exhausted and so the format was reversed. In 1965 the format was changed again with the introduction of the suffix letter. The registration year ran from 1 January to 31 December until 1967 when it was moved to 1 August.
The D.V.L.C (Driver and Vehicle Licensing Centre) was commissioned in 1974 when the process of vehicle registration and licensing was centralised.
The word CENTRE was changed to AGENCY (what we now know as D.V.L.A. Swansea) thus becoming an executive agency and it’s tie with the Department of Transport was cut to give it commercial freedom.
The prefix letter format was introduced in 1983.
Q plates were also introduced in 1983 to kit cars and some imports where the date of first registration could not be established. Vehicles registered as a Q plate do not qualify for a cherished transfer, the Q plate is registered to the vehicle and is non transferable.
In 2001 the number plate combination was changed again with the introduction of the current format of 2 letters (determined by the location) 2 numbers (relevant to the year) and 3 letters (random).
In the early sixties a few numbers were advertised on the front page of the Sunday Times, fast forward 40 years and it has now become a multi million pound industry and what a fascination they have become, even to the point that there are books written soley about the Car Number Plate.
The D.V.L.A started selling cherished car registrations back in 1989 when the sale of Registration Marks Regulations came into force on 20th November.

Cherished Number Plates are now considered to be one of the best long term investments that money can buy and have become a growth industry, with thousands of motorists now displaying registrations which perhaps represent their initials or advertise their business or profession. Others choose a number which bears an amusing message or simply to disguise the true age of their vehicle.

Over the last few years number plate prices have risen considerably and now more and more people from all walks of life are buying their own personalised car registration number.
In 1999 alone, drivers spent a record £60 million on cherished car registration numbers. About 116,000 were purchased in 1998 with the average price being around £376.
The most expensive registration number sold at auction was K1 NGS which was sold for £231,000 and the most expensive number plate sold to date is F1 which was sold for £440,625
 
Cherished number plates can be displayed on your vehicle or either kept on a V750 Certificate of Entitlement or V778 Retention Certificate both of which are renewable each year for a fee.
When choosing a cherished car registration number  you must always be aware that you are not allowed to make the vehicle look newer than it is, so if you are going to choose a registration that contains a suffix or prefix letter or the new style format the vehicle cannot be older than the registration. i,e if you were to buy a cherished car registration with a ‘D’ prefix  then the car it is transferred onto must be a 1986 D registered vehicle or newer, it could not be transferred onto an ‘A’ 1983  prefix registered vehicle. Any cherished car registration numbers that do not contain a suffix, prefix or the new format letters which are generally known as ‘Cherished or Dateless Registration numbers’ can be transferred onto any year of vehicle as they contain no dating letter. 
When transferring a registration onto your car it must have a current MOT (if applicable) and road tax. If you are selling a number plate the donor vehicle must be currently Mot'd and taxed or have been taxed within the last 12 months whereby you can qualify for the 12 month rule. This means that you can still transfer the registration number from the donor vehicle up to 12 months after the tax expires (not surrendered) but should it require an inspection at your local vehicle registration office you would have to transport it on a trailer.
 
Documents required for a Transfer are the V5C registration document (log book), Mot Certificate (where applicable) and a photocopy of the tax disc (for both vehicles) and the fee for this is £80.00.
Documents required for a Retention are V5C registration document (log book), Mot Certificate (where applicable) and photocopy of the tax disc and the fee for this is £105.00.
 
I hope you found this brief history helpful and if you have any questions please feel free to contact me via ebay.