Jan. 4 (Bloomberg) -- Toyota Motor Corp., locked in a global sales race with General Motors Corp., overtook Ford Motor Co. in the U.S. in 2007 as Asia-based carmakers strengthened their hold on the world's largest auto market.

Honda Motor Co. and Hyundai Motor Co. increased U.S. sales in December, while Toyota and Nissan Motor Co.'s sales dropped, the companies said yesterday. Japanese and Korean automakers held 41.3 percent of the market, a 0.9-point gain from a year earlier, according to data compiled by Bloomberg. For the full year, they accounted for 41.7 percent of autos sold, up from 40.4 percent.

The Asian companies boosted their share as U.S. sales for the year fell to a nine-year low of 16.1 million new cars and light trucks amid slumping consumer confidence, high gasoline prices and a weak housing market. Toyota cut its 2008 U.S. sales-growth forecast after reporting a December decline.

``If you're seeing Toyota and Nissan both down and Honda only eking out a small gain, it tells you it's a tough market out there,'' said Jack Nerad, executive industry analyst for Irvine, California-based Kelley Blue Book. ``Consumers are sitting tight because of economic concerns.''

Year-end gasoline prices topped $3 a gallon for the first time. Housing starts, a barometer for sales of pickup trucks, are in the deepest slump in 16 years.

Toyota, which may have passed GM in global sales volume last year, grabbed the No. 2 U.S. ranking from Ford, which had held it since 1931. The Toyota City, Japan-based automaker reported a 1.7 percent sales drop in December, while its annual total rose 3.1 percent to a record 2.62 million.

Toyota

Industrywide sales fell 2.9 percent in December to 1.39 million, and the full-year total declined 2.5 percent.

Toyota sold 224,399 vehicles last month, down from 228,322 a year earlier. The decline was mostly from the company's top- selling cars, including the Yaris and Corolla small models and midsize Camry sedan, the company said yesterday.

The Tundra, Toyota's first pickup designed to compete with large trucks from GM and Ford, had a 54 percent sales increase in December to 19,219. Tundra sales rose 58 percent to 196,555 last year.

The Toyota Camry was the best-selling car in the U.S. for a sixth straight year. The company's Prius, the top-selling gasoline-electric hybrid, outsold Ford's Focus to rank eighth in annual volume among cars.

For 2008, Toyota forecast sales growth of between 1 percent and 2 percent from last year, down from its initial target of a 3 percent gain, said Irv Miller, U.S. vice president for communications.

Honda

The Toyota City, Japan-based company's market share in December rose 0.2 point to 16.2 percent. Toyota's sales totaled 2.62 million last year, compared with 2.57 million for Ford.

Honda, the second-largest Japanese automaker, sold 131,792 vehicles last month, little changed from 131,778 a year earlier, the company's U.S. unit in Torrance, California, said in a statement. The gains were led by the Fit hatchback, Accord sedan, Civic small car and the CR-V, which topped Ford's Explorer to become the top-selling U.S. sport-utility vehicle.

The company's annual sales rose 2.8 percent to a record 1.55 million, extending a 14-year U.S. expansion that is the longest among the market's biggest automakers.

``Honda, which has kind of been overlooked, has done a tremendous job in the last few months,'' said Jesse Toprak, an analyst at Edmunds.com in Santa Monica, California. ``They have been able to keep growing in a negative market and will probably continue to do so in 2008.''

Nissan, Hyundai

Honda's market share in December grew 0.3 point to 9.5 percent. The Tokyo-based company's 2007 share was 9.6 percent, rising from 9.1 percent.

Nissan, Japan's third-biggest automaker, sold 89,555 vehicles, a 2.4 percent drop from December 2006, said Mark McNabb, the company's North American sales chief.

The decline came from ``trucks that were pretty much down across the board,'' he said in a telephone interview. The Tokyo- based company's full-year sales rose 4.8 percent to 1.07 million.

Nissan's U.S. market share was 6.4 percent in December, unchanged from a year earlier, and 6.6 percent for the year, an increase of 0.4 point.

December sales for Hyundai, South Korea's largest automaker, rose 24 percent to 46,487 vehicles from 37,365 a year earlier, the Seoul-based company said in a statement.

Hyundai, Kia

Hyundai's annual sales rose 2.5 percent to 467,009. The company's U.S. market share rose 0.7 point last month to 3.3 percent and 0.1 point for the year to 2.9 percent.

Kia Motors Corp., a Hyundai affiliate, said sales fell 20 percent to 24,068. Kia's annual sales grew 3.8 percent to 305,473.

Mazda Motor Corp., a third owned by Ford, had a 25 percent increase to 24,933 last month on higher sales of Mazda3 small cars. The December gain helped lift the Hiroshima, Japan-based company's annual tally 10 percent to 296,110, the highest level in the U.S. since 1994, spokesman Jeremy Barnes said.

Among other brands, Fuji Heavy Industries Ltd.'s Subaru, a Toyota affiliate, said sales fell 9 percent last month. Mitsubishi Motors Corp. reported a 40 percent decline in December and Suzuki Motor Corp. raised sales 0.5 percent to 7,361. Isuzu Motors Ltd., a Japanese truckmaker, sold 492 pickups and SUVs last month, down 23 percent.

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

Last Updated: January 3, 2008 19:40 EST