BMW shares rise on hopes for premium car rebound

FRANKFURT, July 14 (Reuters) - Shares in BMW AG (BMWG.DE) advanced as much as 4 percent on Tuesday amid strong gains in the auto sector, as upbeat comments from its sales and marketing chief suggested the worst was over for the high-end car sector.

BMW executive board member Ian Robertson told the Financial Times the automaker was ready to increase production in the next six months, indicating a stabilisation in the global car market might be around the corner.

Robertson was quoted as saying the market could show small year-on-year growth rates by the end of this year thanks to weak comparisons in late 2008.

"In the first six months of 2010 we will start to see some real growth. By the end of 2010 demand levels in some regions could be comparable with 2007," he said.

BMW was one of the very first European carmakers to cut production and bring output down to match significantly lower demand, ensuring it was one of the only major players in the region that did not burn cash in its manufacturing business in the fourth quarter of last year.

The company was not immediately available for comment.

Robertson said last week there were first indications of a slight recovery in car markets -- with the pace of year-on-year declines slowing to just below 13 percent in June --- but added that it was not yet clear whether this trend would be sustained.

In the first half, sales of BMW brand luxury cars fell over 19 percent to 513,591 vehicles.

Shares in BMW, the world's biggest premium carmaker, were up 3.7 percent at 27.67 euros by 0843 GMT, outperforming a 1.6 percent rise in the DJ Stoxx European automotive index .SXAP.

Arch-rival Daimler (DAIGn.DE) posted gains of 2.8 percent, extending Monday's advance, as investors moved back into a stock neglected during a major slump among makers of big cars which failed to benefit from government subsidies weighted towards purchases of smaller cars.

Daimler has lagged the European car sector index by around 6 percent this year while BMW has outperformed by around 22 percent.

Matthias Wissmann, head of Germany's VDA car industry association, told a newspaper on Monday he saw improving sales prospects, primarily for the premium auto segment.

(Reporting by Michael Shields, additional reporting by Christiaan Hetzner; editing by John Stonestreet)

((michael.shields@thomsonreuters.com, Reuters Messaging: michael.shields.reuters.com@reuters.net; +49 69 7565 1266)) Keywords: BMW/SHARES

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