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European car sales rise 6.5% in June despite UK dip

[FRANKFURT] European sales of Volkswagen cars dipped in June, a month of rising demand in most large markets which helped rival volume brands Renault, Fiat, Mazda, Kia and Hyundai post double digit percentage sales gains.

Car registrations in Britain, Europe's second-biggest car market behind Germany, fell 0.8 per cent in June, the second drop in more than four years, weighed by a 20 per cent decline in VW sales and an uncertain economic outlook.

VW, Europe's largest carmaker, is grappling with the biggest business crisis in its 78-year history after admitting in September it cheated US diesel emissions tests for toxic nitrogen oxide and in November that it also understated carbon dioxide emissions.

Overall, European car sales jumped as most volume and premium brands saw double-digit growth rates, data provided the Brussels-based Association of European Carmakers (ACEA) showed on Friday.

Registrations of June monthly new car sales in the European Union and the European Free Trade Association increased 6.5 per cent on the year, to 1,507,303 vehicles, ACEA said.

Passenger car registrations in the European Union rose for the 34th consecutive month, with June registrations reaching 1,459,508 new cars.

Two of Europe's five biggest markets recorded double-digit sales gains, led by Italy and Spain where registrations rose 11.9 per cent and 11.2 percent respectively, while French sales increased 0.8 per cent and the region's No.1 market Germany posted 8.3 per cent growth.

Last month's expansion was driven by mass market manufacturers Renault and Fiat Chrysler Automobiles'(FCA) Fiat brand, jumping and 21.2 per cent and 13.9 per cent respectively, ACEA said.

Germany's luxury carmakers also boosted sales, with the core Mercedes and BMW brand sales jumping 16.1 per cent and 14.6 per cent respectively, while Volkswagen-owned luxury brand Audi saw flat sales.

In early June, the European auto industry association ACEA hiked its 2016 EU sales forecast to 14 million passenger cars or 5 per cent growth year-on-year, compared with an earlier forecast of 2 per cent sales growth, predicted in January.