Central Statistics Office figures show that 173,455 new cars were licensed last year, an increase of 4.3% on 2005.
But the figures also showed a sharp drop in new car sales in the month of December, down 29% compared with the same month in 2005 to 1,509.
There was a sharp rise in the number of second-hand cars licensed during the year, up 42% to 16,095.
The total number of all vehicles licensed last year was 316,432, an increase of 12.8%.
