DETROIT, Jan 13: Auto executives expect the industry to be hit by a wave of consolidation and potentially even bankruptcy this year amid a sharp drop in global sales and financial problems at the Detroit Three. After falling an estimated 2.8 million vehicles in 2008, global sales are forecast to drop by a further 4.2 million to 66.6 million units, according to IHS Global Insight.

The bulk of the losses are expected in the United States, where sales could fall to 10.4 million vehicles, the lowest per capital sales rate since World War II.

A sudden drop off in sales at the end of 2008 amid a financial crisis, credit crunch and deepening recession put enormous pressure on the Detroit Three just as they were beginning to reap the benefits of years of painful restructuring.

Cash-strapped General Motors and Chrysler are currently relying on billions in federal loans to maintain operations and Ford has warned that it could also need government help if sales worsen.

Bankruptcy is not completely out of the question, said Irv Miller, vice president of environmental and public affairs for Toyota Motor Sales USA.—AFP