The price of a car in Ireland is rising faster than the European Union average.
New figures have revealed the cost of buying a car has increased by 1.3 per cent in the last year, comparing to an average of 0.8 per cent.
But the rise remains less than half of the 3 per cent rate of inflation.
The European Commission's car price report calculated costs in 25 EU member states between May 2005 and May 2006.
It included prices paid by consumers, VAT and registration taxes. It found the price increase was slightly higher in the euro zone with Spain, Italy, Germany and France also rising more above the EU average.
The figure dropped in the UK by 0.5 per cent, and in Hungary, Slovakia, and Slovenia.
"In the euro zone, pre-tax prices are generally lowest in Finland and most expensive in Germany," said an EC spokesperson.
Of the ten top best selling cars in the EU in 2005, the widest price difference in the euro zone is for the Ford Focus, which costs almost 30 per cent more in Germany than in Finland. This difference represents a potential saving of €4,000 including VAT for the German consumer buying in Finland.
Denmark is the cheapest EU country in which to buy a car.