* July registrations up 6.8 pct -KBA
* Seven-month registrations up 3 pct -KBA
* German sales momentum still discount-driven -analyst
* German rebound contrasts French decline
(Adds official sales data, analyst's comment and background)
By Andreas Cremer
BERLIN, Aug 4 Car sales in Germany bounced back
in July, posting the second-highest monthly gain this year and
suggesting a further pick-up in second-half demand in Europe's
biggest auto market.
Registrations, up 6.8 percent at 270,249 cars, were powered
by demand for premium models and sport-utility vehicles with
Porsche, Chrysler's Jeep and BMW
among the top-selling brands, Germany's Federal Motor Transport
Authority (KBA) said on Monday.
The increase last month, the highest since January's 7.2
percent gain, extended the rise in deliveries in Germany in the
year to date to 3 percent or 1.81 million autos, KBA said,
confirming a Reuters story.
"Germany is very much back on track in terms of volumes,"
said Jonathon Poskitt, head of European forecasting for LMC
Automotive. "The July result is certainly a positive
development, reflecting a solid economic backdrop and generally
improving consumer confidence."
In June German car sales fell 2 percent because the same
month a year earlier had one more working day, slowing the
half-year gain to 2 percent or 1.54 million autos.
However, Poskitt cautioned that discounts continue to fuel
sales in Europe's key market and the region as a whole, eating
into carmakers' profit margins and casting doubt on the strength
of the recovery.
"Incentives have been a feature in that market, and Europe
more generally, for some time and we would not expect that to
change greatly any time soon given the still relatively fragile
market environment in the region," he said.
Europe's car industry endured a six-year slump in demand,
with sales falling to their lowest level in two decades in 2013
as austerity-hit consumers cut back on expensive purchases, but
the market has gradually returned to growth.
The rebound in Germany contrasts with a drop in France,
Europe's third-biggest national market, where light vehicle
registrations fell 4.3 percent to 143,777, paring the
year-to-date gain to 1.7 percent.
With auto sales in the region having risen for 10 straight
months, LMC has predicted "more slow and steady growth" for the
remainder of 2014, with Germany predicted to grow 3-4 percent on
last year's 2.95 million deliveries.
(Editing by Louise Heavens and Greg Mahlich)