Fiat, low-cost brands lifted by southern Europe car demand

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The Fiat logo is seen on the steering wheel of a Fiat "Freemont" model in a mechanic's workshop in Rome, Italy May 23, 2016. REUTERS/Max Rossi (Copyright Reuters 2016)

European car sales rose 9.5 percent last month, regional industry association ACEA said on Thursday, with recovering southern markets benefiting Fiat and low-cost brands.

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Registrations rose to 855,466 cars in August, a seasonally slow holiday month, from 781,575 a year earlier, the Brussels-based Association of European Carmakers said in a statement.

Fiat Chrysler posted the biggest gain among major carmakers with a 20 percent sales increase, helped by a similarly rise in Italy and nearly 15 percent growth in Spain.

Spanish-based budget brand SEAT recorded an 18 percent increase in European registrations, contributing to parent group Volkswagen's 6.3 percent advance.

Sales by France's PSA rose a lackluster 2.8 percent, with the Peugeot brand in line with VW, but Citroen and DS showing declines. Domestic rival Renault gained almost 15 percent, with its no-frills Dacia sales up 40 percent.

(Reporting by Laurence Frost; editing by David Clarke)