WASHINGTON - US AUTO sales plunged dramatically in October as the credit crunch and weak consumer confidence took a toll on consumers and carmakers, industry data showed on Monday.

By some measures, overall sales were the worst since 1991, but analysts said that adjusted for population growth the industry faced its worst month since the 1950s or even the end of World War II.

Total new vehicle sales plunged 31 per cent to 838,156, according to research firm Autodata. That compared with over 1.2 million a year earlier. The figures represent a seasonally adjusted rate of 10.56 million units, down from 16.04 million a year earlier.

Hardest hit was General Motors, which said October US sales tumbled 45 per cent from a year ago, raising fresh doubts about its ability to weather the economic crisis.

GM delivered 170,585 new cars and trucks in the month, a stunning decline attributed to 'uncertainty over the deepening credit crisis' and weak consumer confidence.

'The market has been shrinking for three years, but in October we saw a dramatic decline for the industry and GM,' said Mr Mark LaNeve, vice-president at GM North America.

'We are obviously disappointed in our results which reflect a difficult comparison with a strong year-ago October performance. More importantly, it also reflects an unprecedented credit crunch that is dramatically impacting the entire US economy - from the housing market to big and small companies to banks to family-run businesses. The credit freeze has also had a very negative impact on consumers' confidence and their purchase behavior across America.'

Mr LaNeve said that adjusted for population growth, 'this is probably the worst industry sales month in the post-WWII era.'

GM just barely was able to keep its leading US market share ahead of Toyota, which saw a 25.9 per cent drop in monthly sales to 152,101.

Mr Jesse Toprak, analyst at Edmunds.com, said 'there is a strong chance' that Totota overtook GM in US retail sales excluding those to rental fleets.

Mr Toprak said preliminary data indicate the worst month for the industry in overall sales since January 1991.

'And if you adjust for growth in population this may be the worst sales month since the 1950s,' Mr Toprak said.

The analysts said weak consumer confidence 'is the number one reason' for the precipitous drop in sales, but that tight credit conditions are hurting manufacturers, dealers and consumers.

'A lot of the people who are able to purchase a vehicle are not doing it because of the uncertainty,' he said. 'For the people who want to purchase, unless they have prime credit, they will have a hard time.'

Ford Motor said US sales plunged 30.2 per cent from a year ago as it remained ranked below Toyota in the domestic market. Chrysler said on Monday its US sales slumped 35 per cent from a year ago.

Japanese-based Honda saw a 25 per cent drop in monthly sales while Nissan's slid 33 per cent.

Mr Toprak said the horrific market conditions suggest no recovery in the auto market until 2010, but that it might come too late for Detroit giants including GM.

'Unless GM gets some help (from the US government), they may burn through their available cash and access to credit lines,' Mr Toprak said.

'The auto industry in the US has found a way to slide further into oblivion,' said Mr John Neff of the website AutoBlog.

Mr Neff said a key factor in the GM slump was that its finance arm, GMAC, majority owned by Cerberus (which owns Chrysler) 'decreed it would only lend money to buyers with a credit score above 700, which effectively wiped out in-house financing for the majority of GM customers'.

'While dealers could still work with banks to secure financing (and were encouraged to do so), it appears the damage wrought by GMAC could not be undone,' Mr Neff said.

Mr Toprak said that despite talk of a GM-Chrysler merger, he does not see that as the best scenario to help Detroit, because any merger would have large costs.

'The optimal scenario for GM and Chrysler is some sort of cooperation instead of a true merger, access to each others' know-how and marketing, combined with government help, probably some sort of loan guarantee.' -- AFP