Volkswagen brand has passed Renault as Europe's best-selling brand, according to figures released by ACEA, the European automobile manufacturers association.
For the first nine months, VW's sales grew to 1.15 million units, a 2.3 percent increase over the year-ago period.
Last month, VW sales jumped 11.1 percent over September 2004 on the strength of new models the Golf Plus, Passat and Fox.
By contrast, Renault brand sales dropped 4.4 percent to 1.14 million for the first nine months.
Sales of the Clio, Renault's second-biggest-selling model, declined about 22.6 percent as the French carmaker prepared to launch a new generation of the small car.
Volkswagen and other German brands benefited from modest growth in their home market, which has been one of Europe's weakest in recent years. Sales in Germany grew 3.3 percent, to 2.5 million units for the first nine months.
Though Germany is Europe's largest market, economic stagnation has slowed growth there.
Another German brand, Mercedes-Benz, is showing signs of recovery following a series of crises, including recalls, quality problems and electronics glitches.
Mercedes is still off for the first nine months - down 0.9 percent. But the brand was up for September by 10.3 percent to 70,640, bolstered by new models the R class and B class as well as strong sales from the second-generation A class.
BMW continues to shine. BMW brand sales shot up 15.7 percent to 496,326 for the first nine months, while BMW group grew 13.7 percent to 597,859.
Jaguar's struggles persist. The British carmaker, owned by Ford Motor Co., is abandoning incentives and letting sales find their own level. For the three quarters, Jaguar sales dropped 24.3 percent to 36,862.
Europe's other volume manufacturers are finding it difficult to gain sales momentum. General Motors sales remained flat at 1.26 million units for the first nine months.
Opel/Vauxhall stayed in third place behind VW and Renault with sales of 1.07 million for the first nine months, down 0.5 percent from the same period a year ago.
Ford is Europe's fourth-largest brand with nine-month sales of 998,436, down 3.5 percent from a year ago.
Peugeot brand sales dropped 5.4 percent for the first three quarters to 887,655 units.
Citroen, with more new models on sale, was up 0.6 percent to 728,264.
Struggling Fiat group continues to slide. Fiat brand sales were off 17.6 percent to 558,439 units for the first nine months. Alfa Romeo fared even worse, with a drop of 18.3 percent to 101,374. Lancia, in the middle of a revitalization campaign, was the only Fiat group brand to grow - up 5.8 percent to 93,368 for the three quarters.
Korean brand Kia continues its growth rampage - up 56.3 percent to 184,796 for nine months.
Most other Asian brands showed only single-digit growth so far this year, with the exception of Mitsubishi, which was up 11.5 percent to 103,567.
Mazda was the only Japanese brand to lose sales, dropping 8.8 percent to 185,985.
Nigel Griffiths, analyst for Global Insight in London, said the European market should remain flat through the end of the year.
One wild card is the changing of European exhaust emissions, Griffiths said.
Carmakers must phase out their Euro 3 emission standard models by the end of 2005. Starting in 2006, new vehicles must meet the tougher Euro 4 standard.