The European Union has seen a 4.6 per cent increase in new car sales in the past month, compared with the same time period last year.

The figures, which were released by the European Automobile Manufacturer’s Association, have shown that sales were strongest in Spain, which saw a rise of 28.7 per cent on last year. the association has said that the demand for new cards has risen for the eighth month in a row across the EU.

Sales also rose in Italy and France, as well as the UK, which was an 8.2 per cent increase. These increase helped to offset the figures from Germany, which revealed a 3.6 per cent decrease. Mass marketers including Ford and Renault have also reported stronger growth, particularly compared to premium brands.

Analysts say government incentives, discounts and sales of “nearly new” cars have helped to keep figures positive, but are quick to highlight that overall sales are still much lower than they were before the financial crisis. Incentives to buy also affect the income made in each sale, meaning the increase in sales cannot reliably indicate net profit.

Theo Leggett, business reporter for the BBC, believes that despite this there is cause for hope, stating: “Across the EU, demand has increased steadily since the start of the year, especially in the countries which bore the brunt of the downturn. A car is a major purchase at any time, and if consumers are willing to splash their cash once again, that may suggest returning confidence.”