US car maker sales down for March

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The US auto industry's monthly sales were sharply down on this time last year, although roughly in line with Wall Street expectations.

General Motors said its sales fell 45% compared with March 2008, Ford's sales dropped by 41% and Chrysler's by 39%.

Chrysler said its results were better than feared, after it sold 101,000 cars - the first time it had exceeded 100,000 a month since September.

GM and Chrysler have been given strict deadlines for restructuring.

US President Barack Obama gave GM 60 days and Chrysler 30 days to submit new plans for recovery.

He ordered the resignation of GM chief Rick Wagoner and said bankruptcy protection could speed up the restructuring process.

But he also offered conditional assurances about the industry's future.

No uptick

After March's sales figures were announced, GM chief sales analyst Mike DiGiovanni said: "I think we're seeing maybe the first signs of a brightening in the outlook for the auto industry."

KEY POINTS GM has 60 days to submit new recovery planChrysler has one-month deadline for a merger with Italy's FiatIf merger is successful, Chysler will receive up to $6bn Bankruptcy protection is an optionUS government will guarantee vehicle warrantiesIncentive scheme being considered to boost car sales <a class="" href="/1/hi/world/americas/7972915.stm"> US media on Obama's car firm plan </a> <a class="" href="/1/hi/business/7972539.stm"> Chrysler's decline comes full circle </a>

Efraim Levy, analyst with Standard & Poor's Equity Research, offered cautious optimism. "We believe we may be at or near the trough of the industry's year-to-year comparisons, but do not see an uptick in industry demand before (the fourth quarter of 2009), at the earliest," he said.

GM and Chrysler are looking for more than $20bn of government aid.

After President Obama's speech, Fiat and Chrysler announced they had reached the framework on a global alliance.

The US government would provide working capital for a further 30 days while a merger was discussed, it added.

If a merger is successful, then the government will consider investing up to $6bn.

The two carmakers have already received $17.4bn (£14.4bn) in bail-outs. Chrysler has requested a further $5bn, while GM says it needs $16.6bn more.