The average price of a new car in the UK has increased by 5.6% during the last year, bringing it in line with prices in Europe.

By comparison, average new car prices across Europe as a whole increased by 2.9% over the same period, according to the latest quarterly survey by the Roadtodata Euro Index (formerly eurocarprice.com).

Rick Yarrow, director of analysis services for Roadtodata, said: “Despite the market falling in 2005, new car prices in the UK rose by 5.6% in the 12 months to March 2006 - the second highest increase in Europe.

“Price increases were consistent across all market segments - although slightly lower in the executive and luxury segments. Price increases for petrol models kept pace with those of diesels.”

European market overview

The Roadtodata Euro Index survey also reported that the rate of increase in average car prices throughout Europe slowed significantly in the first quarter of 2006, as total sales in 2005 fell short of the annual market in 2004.

While European new car prices increased by an average of 2.9% in the 12 months to April, this was a weaker rate of increase than in the two preceding quarters, when prices rose by 4.4% in the year to September and 3.4% in the 12 months to December.

Portugal has overtaken Italy as the market with the highest rate of increase in new car prices. Prices for diesel cars have continued to rise faster than those for petrol cars: by 3.1% and 2.7% respectively.

Although diesel vehicles are still likely to overtake petrol as the primary fuel-type for new passenger vehicles in Europe during 2006, it appears that diesel sales are starting to level out.