With galloping inflation putting brakes on consumption and oil hovering around record highs,US auto sales tumbled last month, with all major manufacturers showing declines. They were also joined in their travails by Japanese automaker Toyota, with all three reporting double-digit declines. The two US companies also reported deep quarterly losses. (See: General Motors announces massive $15.5 billion quarterly loss and See: Ford announces $8.7-billion quarterly loss, goes for major restructuring)

General Motors sales plunged 27 per cent and Ford's sales fell 15 per cent, while Toyota's sales slipped 12 per cent. The figures were in comparison with the corresponding month last year but not adjusted for the two extra selling days last month compared with July 2007.

July sales cast another shadow over Detroit's struggling automakers as they grapple with brutal competition, the impact of recent credit rating downgrades and a slump in demand for their most profitable products - SUVs and pickup trucks.

However, Japanese brands Nissan and Toyota, which concentrate on smaller vehicles, showed different results. While bucked the trend with an 8.5 per cent increase on strong car sales, Honda reported only a 1.6 per cent cut.

The current figures correspond to 16 year-lows and showed an accelerating downturn in the world's largest vehicle market. July sales marked the ninth straight month of declining sales in the US auto market, making it the longest such downturn since the 2001 recession.

The sudden shift in buying patterns toward passenger cars hit the Detroit-based automakers hard. As a group, the market share of GM, Ford and Chrysler dropped to 43 per cent in July.

Light truck sales consistently outpaced car sales in the US market for the decade between 1997 and 2007 when rising gas prices began to reverse the trend.
But in July, cars sales outpaced truck sales by 10 percentage points at a 55 per cent to 45 per cent ratio. That shift has put additional pressure on earnings as larger vehicles have had higher profit margins.