That is the finding of new research conducted by the Low Carbon Vehicle Partnership (LowCVP).
The labels use colour-coding to indicate the emission levels of individual new cars – of the seven levels green represents the lowest emission and red the highest.
Fuel economy information is also detailed on the labels.
Paul Everitt, chief executive of the Society of Motor Manufacturers and Traders, told greencarsite.co.uk: "There is no mystery surrounding new car CO2 tailpipe emissions quite simply, low carbon cars use less fuel. There is a simple link between lower emissions and lower running costs.
"The colour-coded label on display at the point of sale represents the simplest method of giving consumers the information needed to make a lower carbon choice."
Mr Everitt, speaking at the British International Motor Show, revealed that exhaust emissions of carbon dioxide from British vehicles had dropped by 13 per cent since 1998.