UPDATE 2-German car market still on track for small 2008 gain

(Adds comments from news conference, details)

By Jan Schwartz

BERLIN, July 2 (Reuters) - Demand for new cars in Germany rose in June and remained on track to increase 1.6 percent in 2008, industry data showed on Wednesday.

Citing a 4 percent rise in first-half domestic orders, the German automotive lobbying group VDA stuck to its forecast for 3.2 million new cars registered this year following a disastrous 2007 in which sales fell to their lowest level since the country's reunification in 1990.

"After weighing all influencing factors, we have decided not to change our deliberately conservative forecast for the domestic car market in 2008," VDA President Matthias Wissmann told reporters.

Registrations rose 1 percent to 304,000 units last month, bringing the first-half figure to 1.63 million -- a gain of 4 percent.

Production fell 1 percent in the month and 2 percent in the first half of the year to 3.03 million vehicles. Exports were flat in June and increased 2 percent to 2.28 million units in the first six months despite the strong euro <EUR=>.

Last year, the VDA only slowly came to realise the depths that demand in Germany would plumb, revising down its 2007 forecast three times over the course of the year and still managing to overestimate the final figure of 3.15 million.

Thankfully for assembly line workers, production remained high as foreign demand took up the slack.