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

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.

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)