US carmakers are having to rethink their business models

Even Toyota, which had double-digit growth in March, saw demand for its new vehicles fall 4% - its first US sales drop in two years.

Ford said demand had dropped 12.9% compared with this time last year, with General Motors (GM) down 9.5%.

Higher petrol prices and consumer debt were blamed for the trend.

The US business of DaimlerChrysler saw sales rise 1.2% thanks to sales at its Chrysler group, though Honda sales slipped 2% and Nissan saw its demand drop 11%.

"It appeared to us that customers were just frozen," said Nissan spokesman Brad Bradshaw, citing the close to $3-a-gallon price of fuel and a weak housing market for Americans holding back purchases.

Cost-cutting

Japanese carmakers have been boosting foreign sales and making gains in the US, the world's largest car market.

Last month Toyota said it had overtaken GM to become the world's biggest carmaker, selling 2.348 million vehicles in the first three months of 2007. Meanwhile US carmakers are having to cut jobs and revamp models to try to win clients.

DaimlerChrysler has said it is going to trim 13,000 jobs in the US and Ford and GM have unveiled plans for thousands of job cuts.

Ford said it will close 16 factories in North America and cut 45,000 jobs. GM has closed 12 plants and cut more than 34,000 jobs.