* Group sales up 6.5 pct in Jan, best in 4 months
* Europe sales up 8.5 pct vs 0.5 drop in FY 2013
* VW says 2014 will remain challenging
BERLIN, Feb 14 (Reuters) - Volkswagen group sales grew at the highest rate in four months in January as deliveries in core European markets bounced back, offsetting double-digit declines in the United States and Brazil.
Sales of passenger cars, sport-utility vehicles and vans increased 6.5 percent to 798,100 autos from 749,500 a year ago, the Wolfsburg-based manufacturer said on Friday.
In Europe, where VW suffered a minor 0.5 percent drop in group sales last year, registrations of vehicles including the Audi luxury brand and Czech division Skoda were up 8.5 percent last month to 273,700 autos, VW said.
“We are seeing the first increases in Europe, above all in Western Europe, where the downturn appears to have bottomed out,” VW sales chief Christian Klingler said.
Industry executives and analysts expect a return to low single-digit sales growth in Europe after six years of decline, but they also have said that chronic excess capacity, which has sparked a price war, will continue to dampen car makers’ profitability.
VW said last month that while the situation in Europe appeared to be stabilising, economic uncertainty would continue and challenges in the markets would remain virtually unchanged.