Europe car market rises for first time in 9 months

European registrations rose marginally in May, helped by a jump in deliveries in Germany.

Sales in the EU and EFTA markets climbed 0.04 percent to 1.44 million cars compared to a year ago, industry association ACEA said in a statement on Tuesday.

Among the winners for the month were Lexus, whose registrations rose 26 percent; BMW, up 15 percent; Seat, also up 15 percent; Citroen, up 14 percent; and Toyota brand, up 11 percent.

Losers included Alfa Romeo, whose volume plunged 49 percent; Nissan, down 18 percent; Jeep, down 13 percent; Renault brand, down 10 percent; and VW brand down 8.6 percent.

Sales in Germany surged 9.1 percent. Automakers in Europe's biggest market, including Volkswagen and BMW, are offering as much as 7,500 euros ($8,424) in incentives toward purchasing cleaner models as a number of cities weigh or have put in place bans on older diesel cars.

Sales fell 4.6 percent in the UK, where declining diesel demand and uncertainty over Brexit continues to put off consumers from purchasing new vehicles.

Spanish registrations fell 7 percent in May because of a slowdown following an Easter surge in April.

The French and Italian new-car markets were both down 1.2 percent.

The gain in Germany came despite gloomy economic data showing an unexpected rise in unemployment in May as well as consumer confidence coming in below predictions.

The slight increase in May registrations was the first in nine months.

Car sales had been in a protracted slump since August, starting with wild gyrations after new emission testing regulations that extended into worsening anxiety over Brexit and slowing economic growth. Softer sales have led to sliding profits as automakers battle global jitters over U.S.-China trade tensions as well as ongoing unprecedented spending on the shift to electric cars.

The reprieve from a nascent turnaround may be short-lived, as automakers ready for tightening European Union regulation on fleet carbon dioxide emissions starting next year.

The industry faces penalties of 33 billion euros, unless more improvements can be achieved, Evercore ISI analyst Arndt Ellinghorst said in a note last month.

The new rules will pressure automakers to sell more electric and plug-in hybrid cars, which for now sell at lower margins than cars with combustion engines.

Peter Fuss, a partner at EY Consultancy, said the market is still "fragile."

"Given the gloomier economic outlook and the unresolved Brexit issue, these markets are likely to see even more downturn as the year progresses," Fuss said.

For the year through May, Europe's car market declined 2 percent to 6.94 million, according to ACEA.

Bloomberg contributed to this report