PARIS: French automaker Peugeot Citroën has reported a rise in global vehicle sales during the first half of the year, but warns that the rest of 2008 looks less bright, particularly in Western Europe.

The company said sales increased 4.6% in H2 and forecast a full year rise of 5%. Demand in emerging markets such as Russia, Brazil and Argentina has been strong.

But sales in Europe are forecast to slip by around 4% by the year end as the credit squeeze, soaring fuel prices and raw materials costs take their toll.

Overall sales in many European key markets, including Spain and Italy, were down in H1, despite robust sales of the Peugeot 308 and new versions of the Citroen C5 marques.

Sales in the domestic market have been relatively buoyant, thanks to the French government's financial incentive for low-emission cars.

Data sourced from Wall Street Journal Online; additional content by WARC staff