New car registrations in western Europe dipped for the second consecutive month in August amid continued weak sales in Germany and consumer jitters around the continent.

According to Reuters, Brussels-based carmakers' group ACEA said sales slipped 0.8% in August after a 5.0% year-on-year drop in July, bringing the total number of cars sold in the first eight months to 9.84 million vehicles - a rise of 1.8%.

Germany's DaimlerChrysler had a particularly bad August, seeing group sales in western Europe retreat 13.3%, with a 16.6% decline at its flagship Mercedes brand, amid disruptive but rejuvenating model changeovers that cut the group's market share a full percent to 6.4%, the report noted.

Registrations of passenger cars from the Volkswagen group, Europe's biggest automaker, fell 8.2%, led lower by a 13.4% drop of VW-brand cars, Reuters said.

"The really bad one out of all of this is really Daimler," CSFB analyst Harald Hendrikse told Reuters, citing poor sales of Mercedes E-class models in Germany.

"Volkswagen also lost 150 basis points (of market share), but if you look at month on month July and August Daimler was down from 6.5 to 6.4 so their numbers today look horrendous and in fact even the July number looked horrendous," he added.

"They are clearly the worst and Mercedes is having a really bad time."

Reuters said Korean carmakers continued to make inroads into the western European market in July and August - traditionally a time of weak sales as many buyers go on holiday - while Japanese companies recovered last month from a rare stumble in July.

"It is partly the economic environment. They are the cheapest car in the market and clearly people are in the mood to buy cheap cars," Hendrikse told the news agency.

ACEA reportedly said the figures reflected "current economic uncertainties in a number of countries", noting only five of the 15 pre-expansion European Union countries generated increases in July while 10 were able to do so in August.

The data include registrations in these 15 EU members plus Norway, Switzerland and Iceland.

Spain had two more working days in July and August than in the previous summer, while Belgium, France, Ireland, Italy, Austria and Portugal each had one extra shopping day, ACEA said, according to Reuters.

The report noted that the auto industry accounts for roughly 4% of the European Union's gross domestic product and serves as a gauge of consumer confidence in a broader European economy still facing chronic high unemployment and fitful growth.

Looking at the market by country, Reuters said Germany, Europe's largest economy and biggest car market by far, remained in a slump as new registrations fell 3.1% in August, making for a fall of 2.2% in the year to date.

Number-two market France saw August sales rise 2.8% and fifth-ranked Spain advanced a brisk 7.3%, but Italy and Britain both fell back 4.9%.

Once again, data showed that the trend towards less expensive imports continued in western Europe as Korean carmakers made another strong showing.

Galvanised by a 53.5% jump in sales of Kia brand cars to 10,825 units, Korean manufacturers boosted their market share last month to 4.9% from 3.7% in August 2003, Reuters said.

Eight-month sales for Korean brands totalled 386,356 vehicles - more than sales of German premium car maker Audi. Their 22.4% growth easily beat the 8.7% rise at their Japanese rivals, which sold 1.3 million units.

Battling supply bottlenecks, especially for diesel engines, Toyota eked out 0.7% growth in August including sales of its premium Lexus brand. That was a rebound from a 10.0% drop in July and a 2.9% dip in June.

Mazda and Honda both generated double-digit growth in August.

French carmaker Renault had a good month, boosting sales 5% to reverse a weak July and creep back into positive territory for eight-month registrations, Reuters said.

But French rival PSA, Europe's second-biggest carmaker, saw registrations dip 2.3% in August, extending July's 8.7% decline.

Other major European auto companies posted mixed results, according to the report.

General Motors boosted group sales 2.6% and BMW advanced 4.4% amid a flood of new models.

But Fiat sales dipped 3% and Ford group slipped 2.4% despite strong showings by its luxury brands Jaguar and Volvo, Reuters said.