In Britain, car sales fell 19 percent, for the worst August since 1966. Sales plunged 26 percent in Italy and 41 percent in Spain, which is going through a housing slump as severe as the U.S. crisis.

 

In Germany, Europe's biggest auto market, sales fell in July and again in August after having risen during the first half of the year.

 

'Of the 16 markets included in Global Insight's Western European roundup, just one -- Portugal -- managed any growth at all,' said Global Insight analyst Rebecca Wright. The firm now expects full-year sales in Europe to fall to between 14 million and 14.1 million cars -- roughly the same size as the U.S. market this year -- from 14.8 million in 2007.

 

The slowdown adds to the troubles of General Motors Corp. and Ford Motor Co., which were hoping foreign sales would help offset steep U.S. declines.

 

Last year, GM sold 2.2 million vehicles in Europe, or nearly a fourth of its total sales, and Ford of Europe and Ford's Volvo cars unit sold 2.4 million vehicles. The figures include sales in Eastern Europe, which are holding up better this year.

 

But in Western Europe, 'eroding consumer sentiment and recessionary fears dragged down registrations drastically in August,' and all major automakers suffered declines, said Gaetan Toulemonde, a Paris-based analyst at Deutsche Bank.

 

The raw numbers look bleak because there were two fewer selling days last month than in August 2007. But even on an adjusted basis, Deutsche Bank expects a double-digit decline when official figures are reported on Sept. 16.