European car sales rise 6.5 pct in June despite U.K dip -ACEA

FRANKFURT, July 15 (Reuters) - European sales of Volkswagen (Xetra: 766400 - news) cars dipped in June, a month of rising demand in most large markets which helped rival volume brands Renault (Swiss: RNO.SW - news) , Fiat (Hanover: FIA1.HA - news) , Mazda (BSE: MAZDALTD.BO - news) , Kia and Hyundai post double digit percentage sales gains.

Car (HKSE: 0699-OL.HK - news) registrations in Britain, Europe's second-biggest car market behind Germany, fell 0.8 percent in June, the second drop in more than four years, weighed by a 20 percent 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 U.S (Other OTC: UBGXF - news) . 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 percent 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 percent and 11.2 percent respectively, while French sales increased 0.8 percent and the region's No.1 market Germany posted 8.3 percent growth.

Last month's expansion was driven by mass market manufacturers Renault (LSE: 0NQF.L - news) and Fiat Chrysler Automobiles' (FCA) Fiat brand, jumping and 21.2 percent and 13.9 percent respectively, ACEA said.

Germany's luxury carmakers also boosted sales, with the core Mercedes (Xetra: 710000 - news) and BMW (Swiss: BMW.SW - news) brand sales jumping 16.1 percent and 14.6 percent respectively, while Volkswagen (LSE: 0P6N.L - news) -owned luxury brand Audi (LSE: 0FG8.L - news) 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 percent growth year-on-year, compared with an earlier forecast of 2 percent sales growth, predicted in January. (Reporting by Edward Taylor; Editing by Christoph Steitz)