U.S. Auto Sales in June May Decline to 15-Year Low

U.S. vehicle sales may plunge to their lowest in more than 15 years this month as soaring gasoline prices leave dealers with too many big trucks and a shortage of fuel-efficient small cars, analysts said.

June's annualized sales rate may drop to between 12.5 million and 13 million vehicles, according to reports from Citigroup analyst Itay Michaeli and Deutsche Bank analyst Rod Lache. That would be the lowest since the 12-million rate in March 1993 and as much as 20 percent below June 2007 levels.

“Dealers report they are now suffering from a mismatch between what consumers want to buy (small cars), and what they have in inventory,'' which are pickups and sport-utility vehicles, Lache wrote.

U.S. auto sales have averaged 16.8 million annually this decade. They are now at “surprisingly low levels,'' Lache said.

Additional declines may further set back General Motors Corp.'s and Ford Motor Co.'s turnaround efforts on their home turf. The U.S. is the world's largest sales market and the biggest source of revenue for the two money-losing automakers. More at Bloomberg