PARIS - French carmaker PSA Peugeot Citroen said sales of vehicles and knocked-down kits fell 14 percent in the first six months of the year.

Leaving aside sales of completely knocked-down (CKD) kits -- shipped for assembly in other markets such as Iran -- sales were down 17.5 percent at 1.386 million vehicles, PSA said in a statement on Tuesday.

The company gave no forecast, saying only that the second half of the year would be shaped by the arrival of new car models including the revamped Citroen C3 and Peugeot's 5008.

The car industry has been hit by an unprecedented crisis, with carmakers slashing production and cutting jobs late last year in reaction to a slump in sales.

European car sales fell for the 13th straight month in May, down 4.9 percent to 1.27 million vehicles.

Governments have stepped in to help, providing loans and introducing incentive schemes to help carmakers survive the downturn, leading to some signs of improvement in recent months.

The head of Citroen told Reuters he hoped car scrapping bonus schemes put in place in several European countries to encourage owners to replace older vehicles with newer models would be extended. We are campaigning for the measures to be continued, Frederic Banzet said in an interview on Tuesday.

In any case, we are campaigning for them not to be ended suddenly; nothing would be worse as the automobile industry cannot cope with major movements, he said.

Germany's BMW, the world's biggest premium carmaker, said on Tuesday that its group vehicles sales fell 12.7 percent in June but added it was seeing the first signs of a slight recovery on automobile markets. [ID:nFAB013178]

In France, car sales rose 7.1 percent in June, while in Germany sales were up 40 percent in the month. But industry watchers are concerned about how carmakers will cope with the transition when the schemes end.

Rival Renault is due to report its commercial results together with its financial results at the end of July.

Banzet added that the level of stocks at Citroen, the second brand of car group PSA Peugeot Citroen, was satisfactory. (Reporting by Helen Massy-Beresford, Matthias Blamont and Marie Maitre; Editing by Greg Mahlich and Hans Peters)

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