It is reported that US car sales fell 14% to their lowest annual rate in a decade last month as weak consumer confidence and rising gas prices hit the industry's most profitable vehicles hardest.

General Motors Corporation, Ford Motor Company and Chrysler posted deeper sales declines than expected, led by a sharp drop in trucks and SUVs. Asian competitors also struggled, with Toyota Motor Corporation posting a 5% decline and Nissan Motor Co sales dropping almost 2%.

Mr Erich Merkle consulting firm IRN director of forecasting said that "Almost no one buys new vehicles because they have to, they want to. And in order to want to they have to feel good about their future. That's just not the case today."

According to Autodata Corporation, overall US sales fell to about 14.4 million units on an annualized and seasonally adjusted basis last month, marking the worst result for the industry since August 1998. Of equal concern to car makers, buyers defected from high margin trucks and SUVs to cheaper and more fuel efficient cars more rapidly than expected due to high gasoline prices.

Car sales represent one of the first monthly snapshots of US consumer demand and investors have looked to the reports for evidence of whether the US economy has slipped further toward recession since the start of the year.