Car prices are continuing to move into line across the European Union, according to a new EC report.

It is good news for the UK’s motor retailers, who five years ago were subjected to a “Rip Off Britain” campaign which highlighted the availability of vastly cheaper cars in some other EU member states.

EC analysts state that prices in the UK have fallen by 1.2% compared with the end of 2003. “Price convergence for cars continues to improve in the EU as a whole,” says competition commissioner Neelie Kroes.

“I am confident that the new legal framework for car distribution and strict enforcement of EU competition rules will contribute to further price convergence by removing obstacles to parallel imports throughout the EU.”

The Commission’s latest figures show the average car price deviation between the 25 national markets has fallen from 6.9% in May 2004 to 6.4%, based on November 2004 figures.