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The dismal U.S. auto market took a turn for the worse in October, with vehicle sales plunging by about a third.
As reported by the Wall Street Journal, the financial crisis and tightening credit kept buyers away from showrooms.
Automakers sold 838,186 cars and light trucks last month, according to a tally by Autodata. Adjusted for increases in the U.S. population, last month was the worst since World War II, GM sales analyst Michael DiGiovanni said, adding, “This is clearly a severe recession.”
Auto executives warned that the market could deteriorate further, raising the question of when the auto industry – a key driver of the U.S. economy – would hit bottom.
October’s declines were led by GM, for which sales fell 45% to 166,744 vehicles. The company was hurt when its financing arm, GMAC, began offering loans only to customers with top credit scores.
In many areas of the U.S., only a third or so of all customers would qualify for loans, DiGiovanni said.
Other auto makers also suffered major declines. Chrysler’s sales fell 35% to 94,530 vehicles. Ford reported its sales fell 30% to 132,248 cars and light trucks, Toyota’s fell 23% to 152,101 and Honda’s dropped 28% to 85,864.
The sharp contractions came as U.S. consumer confidence fell in October to its lowest level since the Conference Board, a New York research group, began keeping records in 1967.