Volkswagen's Golf and Polo models were Europe's best-sellers in 2011, according to market analysis from Jato Dynamics.

The Volkswagen Golf continues to be Europe's best-selling car, despite a drop in sales of 1.6% in 2011 compared to 2010.

The Volkswagen Polo retained second place for December and for the year, with sales up 2.9% and 0.5% respectively while Ford's Fiesta held third place both in December and for the year.

Jato's key analysis of the market:
• Volkswagen increased its market share and finished 2011 as Europe's best-selling brand
• Germany was the only Big Five market to experience growth in 2011 with sales increasing 8.8%
• Premium German brands are weathering the storm with increased sales not only at home but also in Great Britain and France
• The Ford Focus and the VW Passat also performed well in 2011, up 7.0% and 46.5% respectively

The ongoing economic challenges in Europe have impacted sales in many Southern European markets such as Greece, Portugal and Spain.

The Baltic markets have seen significant growth in 2011, with Estonia, Latvia and Lithuania up 65.8%, 72.5% and 66.0% respectively.

Out of the top ten brands only the German brands Volkswagen, BMW, Audi and Mercedes ended 2011 with no decrease in sales.

Gareth Hession, vice president, research at Jato, said: "Germany is clearly leading Europe in terms of a market for new cars as well as manufacturing models which appeal to consumers across the region. This is even more impressive considering the challenges we saw in the overall European market during 2011."

Three of the top ten models experienced growth during 2011 compared to the previous year, notably Volkswagen's Passat which saw an increase in sales of 46.5% following the launch of the new version earlier in the year.

There are also some good news stories for models outside the top ten including Peugeot's new 508 which saw sales increase to almost three times those achieved by its predecessor, the 407, in 2010.

Other models that recorded significant sales increases in 2011 include the new Ford CMax/ Grand C-Max, Citroën C4, BMW X3 and Kia Sportage.

Hession added: "The European new car market carries significant risks whilst it remains dependent upon a strong performance in Germany. 2012 is going to be a very important and challenging year especially for European based and sales dependent manufacturers."