MILAN, Jun 16 (Reuters) European car sales rose 7 point 7 percent in May from the same month a year ago, industry data showed today, returning to growth after a dip in April and with nearly all auto manufacturers recording sales increases. New passenger car registrations in the European Union and European Free Trade Association increased to 1.43 million vehicles last month, according to the Brussels-based Association of European Carmakers (ACEA). "In volume terms, this result comes close to May 2007 levels, just before the economic crisis hit the auto industry," the industry group said in a statement. European car sales returned to annual growth in 2014 after a six-year slump during which registrations fell to their lowest in decades. Demand has been growing most months since, as an improvement in consumer confidence, retail incentives and new product launches lured customers back to the showrooms. The May increase comes after registrations dropped the previous month, given fewer trading days around Easter and thanks to a double-digit sales decline in Britain. May's growth was led by Japanese carmakers Suzuki and Toyota, up 21.4 percent and 19.6 percent respectively, and Germany's Daimler, up 14 percent. Sales from the Fiat Chrysler Automobiles stable rose 11.9 percent, as a 47.8 percent jump for sporty Alfa Romeo models helped offset a 7.3 percent drop for its Jeep SUV brand. France's Renault recorded a 10.4 percent rise in registrations, outpacing domestic rival PSA Group, whose sales increased 4.8 percent. Sales at Volkswagen, Europe's biggest carmaker, rose 8.4 percent, both for the group and its core namesake brand, as the German company continues to recover from its diesel emissions test-rigging scandal. Its market share remained roughly stable year-on-year at 24.3 percent. The only carmakers to report falling sales last month were Jaguar Land Rover, down 9.3 percent, Japanese carmakers Honda and Mazda, falling 14.5 percent and 2.3 percent respectively, and Opel Group, down 1.7 percent. All five major national markets, except for the United Kingdom, recorded sales increases last month, led by Germany, where registrations increased 12.9 percent, and followed by Spain, where sales were up 11.2 percent. UK sales dropped 8.5 percent. In the first five months of the year, European registrations increased 5.1 percent to 6.92 million vehicles, ACEA added. REUTERS JW1327