U.S. Auto Sales Slowdown (TM, F)

According to a report by Bloomberg, snowstorms across the eastern parts of the U.S., and Toyota (ADR) (NYSE: TM) recalls may have led to a slowdown in auto sales in February. The extreme weather, and mass recalls may have put customers away from showrooms, dashing the industry’s hopes of a rebound.

Toyota’s recalls have resulted in the company‘s market share dropping to its lowest level since 2005. The market share of the Japanese car maker fell to 12.6%. Toyota’s deliveries for February fell by 10%, while those of General Motors, and Ford Motor Co. (NYSE: F) increased 20%, and 33% respectively. The total annual sales of cars, and trucks reached 10.3 million, up from 9.1 million a year earlier.

February saw most companies post a gain except Toyota, and Chrysler. Toyota plans to offer incentives to customers by offering rebates and longer warranties in order to regain the lost ground after the recall issue.

February is generally the weakest month of the year in terms of auto sales, while June is the strongest. The weakness may have been accentuated by severe weather conditions experienced in the eastern part of the country. Washington and Philadelphia along with most eastern cities in the U.S. have seen record amounts of snowfall. Analysts believe the extreme weather is one of the factors for decline in February auto sales.

The decline in consumer confidence and auto sales suggests that there is still some way to go before the US economy recovers completely from the worst economic crisis since the Great Depression.