JD Power sees October auto sales down 6 percent

DETROIT (Reuters) - October U.S. auto sales should be down about 6 percent from a year ago, marking the first single-digit monthly decline since May 2008, industry forecasting firm J.D. Power and Associates said on Friday.

J.D. Power, forecasting October sales of 10.3 million units on an annualized basis, said improvements in consumer confidence and credit have started driving sales for the battered industry, which is down nearly 30 percent this year.

U.S. government figures show October 2008 total sales were 10.8 million units.

"While year-over-year comparisons benefit from a low selling base in October 2008, improvements in consumer confidence and credit are propelling the return to positive sales gains relative to last year," said Gary Dilts of J.D. Power.

While the forecast is for the first single-digit drop in sales in 17 months, August 2009 showed a 13 percent increase in annualized sales from a year before. However, that month was seen as an anomaly because of higher sales generated by the government's "Cash for Clunkers" incentive program.

September sales, pressured by the end of that program, fell 23 percent year-on-year and on an annualized basis was 9.2 million units.

Separately, Deutsche Bank said it expects October U.S. light vehicle sales to be 10.7 million units on an annualized basis.

Deutsche Bank forecast that General Motors Co GM.UL would report a 16 percent increase in October U.S. sales from a year ago, helped by increased incentive spending. GM's U.S. sales plunged 45 percent in September.

(Reporting by Bernie Woodall, Editing by Gerald E. McCormick)