TORONTO - Ford Motor Co of Canada was the number one selling automaker in the country for the first time in 50 years as it posted a 25 percent jump in sales in June over a year earlier, the company said on Thursday.

Overall auto sales in Canada fell by 13.2 percent in June to 138,500 units, according to data from DesRosiers Automotive Consultants Inc. It was the eighth month in a row of year-over-year sales declines.

Ford, the only Detroit auto company not supported by emergency government funding, sold 27,408 vehicles in Canada in June, marking its first year-over-year sales increase of 2009, and its eighth month in a row of market share gain.

Ford Canada's car sales dipped 1.5 percent in the month to 6,648 units, while truck sales surged 36.1 percent to 20,760.

David Mondragon, Ford Canada's president and chief executive, told Reuters that while the overall market appears to have bottomed, there will likely be some difficult months ahead before industrywide sales really begin to recover in the fourth quarter.

We are not waving a flag of victory by any means, he said. This was a good month and we're going to celebrate the month, but we're going to continue to focus on our plan to grow our share of the market as the year goes on.

Mondragon said that while he expects overall Canadian vehicle sales to be down by 14 percent to 18 percent during the third quarter, Ford Canada has already begun ramping up production.

We've added 16 percent of year-over-year production increase in the third quarter to help us meet higher levels of demand and forecast higher levels of demand as we go into the later part of the third and into the fourth quarter, he said.

General Motors Corp entered Chapter 11 bankruptcy protection at the beginning of June and it recently argued in a U.S. bankruptcy court that the sale of its assets to a new GM is its only option beyond liquidation.

The company's Canadian arm said its sales for June dropped 31 percent to 22,334 units. Car sales fell 40 percent to 10,879, while truck sales slid 20 percent to 11,455.

Chrysler, which recently sold its best assets to a group led by Italy's Fiat SpA, said its Canadian sales plunged 59 percent during the month to 9,211 units.

The company, which restarted production at North American plants at the end of June, said truck sales fell 50 percent to 7,758 units, while car sales fell 78 percent to 1,453.

The temporary plant closures helped reduce excess inventory, but they also cut into fleet sales.

With our plants down, limited inventory on the ground and virtually no fleet deliveries, we were relegated to the bench for much of May and June, said Reid Bigland, president of Chrysler Canada. Now that those issues are behind us, we look forward to getting back into the game in July, he said.

Sales at Toyota Canada Inc skidded 17 percent percent to 18,600 units. The automaker's Toyota division saw sales fall 18 percent to 17,198 last month while sales at its luxury Lexus division fell 10 percent to 1,402.

Honda Motor Co Canada Inc sold 13,754 units in March, down 17 percent from last year. The company said its Honda division sold 11,942 units, down 20 percent, while its Acura division reported May sales of 1,812, up 13 percent from a year earlier.

($1=$1.16 Canadian) (Reporting by John McCrank; editing by Rob Wilson)

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