New car registrations in Europe's biggest market have risen by six per cent according to the latest figures published by the German automobile industry association VDA.

Improved consumer confidence and the cessation of conflict in Iraq have been held responsible for the rise, spurring a rise in the number of new German registrations to 300,000 vehicles.

The statistics mean that the fall in the year to date is now just one per cent, offering encouraging signs for Germany and other European nations.

Registrations rose year-on-year for the first time in 2003, taking the cumulative January-May total to 1,374,200 vehicles.

VDA described the data as offering a 'glimmer of hope' for the German auto market.

The association is now predicting some 3.25 million new car registrations in total for 2003, a negligible difference on sales for 2002.

However, whilst VDA said monthly production had risen by nine per cent and exports increased by three per cent, individual car manufacturers have so far been more cautious in their outlook for the industry.