FRANKFURT, Germany – Daimler AG said Friday its Mercedes-Benz car division's sales in August fell by 12 percent compared to the same month a year ago, dragged down by faltering sales in western Europe.

The company said western Europe sales were down nearly 20 percent for the month, but also emphasized that August 2007 had two extra sales days.

Overall, the company sold 84,400 vehicles, compared with 96,200 in August of 2007.

The company said despite the slowdown, demand for new models like the CLC sports coupe increased by 60 percent, while sales of the SL-class saw a rise of 31 percent.

Developments were also much more positive for the Smart brand, Stuttgart-based Daimler said. Worldwide sales of the car increased by almost 30 percent in August, with nearly 20,000 of the 90,000 sold destined for the U.S.

“The Smart fortwo is now in greater demand than ever before,” said Klaus Maier, the company's sales and marketing chief.

For the first eight months of the year, Mercedes-Benz saw a 5 percent increase in car sales. Smart brand sales alone rose by over 50 percent.

Mercedes Benz Cars sales increased in China by nearly 60 percent for the first eight months, while sales in the U.S. rose only 1 percent.

Shares of Daimler fell 4.2 percent to 39.69 euros ($52.32) in Frankfurt, where stocks were broadly lower.

---