Nov. 4 (Bloomberg) -- Toyota Motor Corp. and Honda Motor Co., Japan's two biggest carmakers, posted October U.S. sales declines of more than 20 percent while still gaining market share because of the industry's 32 percent plunge.

Toyota, second in the U.S., reported a 23 percent drop, Honda's sales fell 25 percent and Nissan Motor Co.'s declined 33 percent. While sales for all Asia-based companies fell 27 percent, combined market share for Japanese and South Korean brands rose 3.3 percentage points to 44.4 percent, according to Autodata Corp.

Sales dropped for a 12th straight month, extending the longest U.S. slide in 17 years. Tight credit, falling consumer confidence and a weakening economy, the same forces that suppressed buying in September, hurt automakers again last month. That prompted Toyota to extend a no-interest loan offer it began early last month.

`If you've got Toyota out there with an aggressive 0 percent finance program, a company with its product line, strong brand reputation and healthy finances coming in with a 23 percent decline, you know it's a bad market,'' said Tom Libby, a Troy, Michigan-based analyst at research firm J.D. Power & Associates.

Total October sales were down 32 percent to 838,156 from 1.23 million, for the lowest monthly total since January 1991, according to Autodata. General Motors Corp., with a 45 percent decline, said that adjusted for population growth, last month was the industry's worst ``in the post-World War II era.''

Toyota

Toyota sold 152,101 vehicles, down from 197,592 a year earlier. Toyota brand sales fell 21 percent and Lexus luxury cars and sport-utility vehicles declined 35 percent.

The Toyota City, Japan-based company now expects to sell between 2.2 million and 2.3 million vehicles in the U.S. this year, Bob Carter, U.S. vice president of Toyota-brand sales, said in a conference call yesterday. That would be a decline of as much as 16 percent from the 2.62 million autos the company sold in its biggest market last year.

``They'll be down, but I'd expect them to finish the year at about 2.3 million,'' said Jesse Toprak, director of U.S. market forecasting for Santa Monica, California-based Edmunds.com.

Toyota is extending a no-interest loan promotion on most of its top-selling models through at least the end of this month, Carter said.

The company's market share increased to 18.1 percent last month from 16 percent a year earlier, Woodcliff Lake, New Jersey-based Autodata said.

Toyota gained as much as 5.9 percent to 3,950 yen and traded at 3,900 yen as of 9:36 a.m. in Tokyo.

Honda Fits

Honda, based in Tokyo, sold 85,864 cars and light trucks, a drop from 114,799 a year earlier, spokesman Kurt Antonius said in an interview. Among the few models with an increase was the Fit subcompact car, with a 33 percent gain.

The company sees no current need to follow Toyota and Nissan, which last week said it also will offer no-interest loans on its top-selling U.S. models, Antonius said.

Honda raised its market share to 10.2 percent, from 9.3 percent a year earlier, Autodata said.

Nissan Sales

Nissan's October sales dropped to 56,945 from 84,947, Al Castignetti, vice president of U.S. Nissan-brand sales, said in an interview. Gains for the Versa subcompact car, Maxima sport sedan and Rogue small crossover wagon failed to offset declines for most of the company's larger cars and light trucks, he said.

Nissan last week said it would offer no-interest financing on Sentra and Versa small cars, midsize Altima sedans and Rogue and Murano crossovers.

The company's market share fell 0.1 point to 6.8 percent.

Honda's shares rose 3.5 percent to 2,485 yen. Nissan dropped 7.3 percent to 457 yen.

The results of today's U.S. presidential election may help ease the slump in sales in November and December, said Nissan's Castignetti, J.D. Power's Libby and Edmunds.com's Toprak.

``In November, I think quite frankly we're going to have a better month,'' said Castignetti. ``One way or another, this seemingly endless campaign finally gets closed. Whether you like it or not, you'll know what's going on.''

Hyundai, Kia

Hyundai Motor Co., South Korea's largest automaker, reported a 31 percent drop in sales to 20,820 vehicles, from 30,232 a year earlier. The Seoul-based company's market share was unchanged at 2.5 percent.

Kia Motors Corp., a Hyundai affiliate, sold 15,483 vehicles, down 39 percent. Ford Motor Co.-affiliated Mazda Motor Corp. said it sold 16,442 autos, a 26 percent decline.

Among smaller brands, Fuji Heavy Industries Inc.'s Subaru said sales fell 14 percent. That was the smallest decline among Asian brands last month. Fuji Heavy, a Toyota affiliate, also remains the only Asian automaker gaining in the U.S. through October, with sales up 2.1 percent from a year ago.

Mitsubishi Motors Corp. posted a 19 percent drop, while Suzuki Motor Corp.'s sales declined 47 percent. Isuzu Motors Ltd., a Japanese truckmaker that's ending U.S. passenger-vehicle sales after 2008, had a 56 percent decrease.

To contact the reporter on this story: Alan Ohnsman in Los Angeles at aohnsman@bloomberg.net

Last Updated: November 3, 2008 20:03 EST