Sept. 18 (Bloomberg) -- Honda Motor Co., Japan's second- largest carmaker, said the financial turmoil caused by subprime loans in the U.S. may hurt global car sales.

``The subprime problem triggered by the U.S. is starting to have a big impact globally,'' said Honda Chairman Satoshi Aoki, who spoke as chairman of the Japan Automobile Manufacturers Association at a press conference in Tokyo today. Demand in China and India, the world's two fastest-growing major economies, may also be slowing, he said.

The U.S. auto market, hurt by higher fuel costs and a housing slump, is headed to the lowest annual total since the early 1990s. The failure of Lehman Brothers Holdings Inc., once the fourth-largest U.S. investment bank, may also sap demand, as consumers avoid buying expensive goods.

``The bankruptcy will have a negative impact on consumer sentiment,'' Aoki said. Some people ``may not be able to get credit.''

Sales in the country, which slid for a 10th straight month in August, may drop to 14.2 million this year, the lowest since 1993, according to J.D. Power & Associates. Automakers sold 16 percent fewer cars and light trucks last month. The U.S. market may fall below 14.5 million vehicles this year, Aoki said.

Japanese automakers will try to use fewer types of steel and review procedures for ordering the metal in an effort to reduce costs, Aoki said. The auto group will study the measures with the country's steelmakers' association, he said.

Honda fell 4.5 percent to 3,160 yen at the 3 p.m. close on the Tokyo Stock Exchange. The benchmark Nikkei 225 Stock Average declined 2.2 percent to 11,489.30, the lowest since June 2005.

To contact the reporters on this story: Naoko Fujimura in Tokyo at nfujimura@bloomberg.net; Tetsuya Komatsu in Tokyo at tekomatsu@bloomberg.net

Last Updated: September 18, 2008 02:45 EDT