Sales at DaimlerChrysler's premium Mercedes Car Group rose 5 percent in June to 111,000 vehicles, the German-American carmaker said on Thursday.
Sales of Mercedes-Benz cars rose 6 percent to 97,500 vehicles, a record level for June, while deliveries of Smart subcompacts fell 1.1 percent to 13,500 cars.
The division's sales fell a cumulative 1.9 percent in the first half to 573,900 vehicles.
Despite a 4.3-percent decline in deliveries of its Mercedes Benz brand cars in the first half this year, the company said it expected sales of its flagship marque to rise in the coming months.
Daimler said rollouts of new models -- such as its new M-class offroader, B-Class compact sports wagon and top-line S-Class sedan -- should help spur demand.
The B-Class hit dealerships in western Europe last month and the S-Class sedan will debut at September's Frankfurt car show.
Both the B-Class and M-Class enjoyed an "excellent" start in Western Europe, Daimler said. It sold 6,300 B-Class cars in June and has orders for roughly 40,000 units.
Because the M-Class was launched on July 2 Mercedes declined to provide order figures on Thursday but said it expected to publish more details in the coming days.
The company reaffirmed it expects Mercedes Benz brand sales to post an unspecified increase for the full year, while sales for the Mercedes Car Group, including Smart and its super luxury Maybachs, are forecast to rise slightly in 2005.
DaimlerChrysler stock, the worst performer this year in the DJ Stoxx European car sector index, was down 1.5 percent at 33.21 euros by 0830 GMT while the index fell 1.3 percent.