UPDATE 1-Scrappage scheme boosts French June car sales

* French car sales up 7.1 percent in June

* Sales up 0.2 pct over first six months

* Industry body warns of "delicate" end to scrapping scheme

* Scrappage eases sales decline in Spain

* Peugeot shares up 1.34 pct, Renault up 2.45 pct

(Adds details, reference to sales in Spain)

PARIS, July 1 (Reuters) - French new car sales rose 7.1 percent in June as a government scheme to help crisis-hit automakers by encouraging drivers to trade in old cars for new boosted demand, industry association CCFA said on Wednesday.

A parallel scrappage scheme also gave a boost to auto retailers in Spain, where CCFA's counterpart ANFAC said the rate of decline in car sales eased to 15.9 percent last month from 38.7 percent in May. [nL1689392]

The French association warned that ending the incentive scheme -- a move expected around the end of the year -- would be "delicate" and urged the government to find a way to phase it out gradually.

As of mid-June, around 200,000 new car registrations in France, or 20 percent of the total, were linked to the scheme offering cash payments for traded-in old vehicles, Xavier Fels, CCFA president, told a press conference, noting that complete figures for the first six months were not yet ready.

"We're still a long way from the end of the year (when the scheme is due to end)," Fels said, "and everyone is conscious of (the issue). We're sending the authorities a message of caution and it's up to them to decide the best way to play it."

New passenger car sales rose 0.2 percent in the first six months of the year, the association said.

PSA Peugeot Citroen (PEUP.PA) saw a 12.7 percent increase in sales in June, with the Citroen brand posting a 15.1 percent rise and Peugeot branded vehicles up 10.5 percent.

Renault group sales rose 10.3 percent in June, with Renault brand sales up 5.6 percent and Dacia sales rising 87.7 percent.

Renault's alliance partner Nissan Motor Co (7201.T) posted a 36.7 percent increase in June sales in France, but some other foreign brands performed less strongly. Toyota Motor Corp's (7203.T) sales were down 16.3 percent, including Lexus, while BMW (BMWG.DE) sales fell 11.4 percent in France.

PSA Peugeot Citroen shares rose 1.34 percent 1049 GMT, while Renault shares were up 2.45 percent. The DJ Stoxx European Autos Index .SXAP was up 1.51 percent.

(Reporting by Helen Massy-Beresford; editing by John Stonestreet)