UPDATE 1-Daimler sees Mercedes sales up significantly in Q4

* Mercedes-Benz Cars sells 16 pct more vehicles in Nov y-o-y

* Mercedes brand sales up 19 pct at 88,600 vehicles in Nov * Daimler says new E-Class estate generates fresh momentum

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FRANKFURT, Dec 7 (Reuters) - Daimler (DAIGn.DE) expects fourth-quarter sales volume at its Mercedes-Benz passenger car division to rise considerably in the fourth quarter as weak year-earlier figures helped flatter growth rates in November.

"As expected, in November we built on October's positive development and once again significantly increased sales worldwide," said Joachim Schmidt, Mercedes' head of sales and marketing, in a statement.

This year's launch of its key E-Class full-size luxury sedan has helped drive demand, doubling the car's global retail sales volume to 15,700 last month.

"Additional sales momentum will be generated over the next few weeks by the new E-Class estate, which reached the dealerships on Nov. 21 and has been a big hit with customers," Schmidt added.

November sales at the Mercedes-Benz brand rose 19 percent over last year's month to 88,600 units.

Smart brand sales fell 4 percent to 9,800 cars in November, bringing total volumes for last month at the Mercedes-Benz Cars division to 98,400 vehicles, translating into a 16 percent increase.

Last year, fourth-quarter volumes at Mercedes-Benz Cars plunged 22 percent to 284,956 cars -- falling even below the seasonally weak third quarter -- after car markets froze following the Lehman collapse in September.

Mercedes competes most closely with its two rival German luxury brands BMW (BMWG.DE) and Audi, a marque owned by Volkswagen (VOWG.DE).

(Reporting by Christiaan Hetzner)