PREVIEW-US Oct. auto sales seen up, but no sign of recovery

* What: U.S. October auto sales

* When: Tuesday, Nov. 3, starting at about noon EDT

* Sales rate seen above 10 mln units vs 10.8 mln yr ago

* October sales seen best of 2009 outside "Clunkers" boom

By Soyoung Kim

DETROIT, Oct 30 (Reuters) - U.S. auto sales in October are expected to provide more evidence that the worst of the industry's four-year downturn has passed, while leaving open doubts about the speed and strength of the recovery.

Analysts and executives expect U.S. auto sales will be above 10 million vehicles on the annualized basis tracked by the industry.

That would mark the strongest result of the year with the exception of July and August, when car sales got a short-lived boost from the U.S. government's "Cash for Clunkers" trade-in incentives.

"The industry is getting some legs under it without the stimulus of Cash for Clunkers," General Motors Co [GM.UL] sales analyst Mike DiGiovanni said. "That said, this isn't great," DiGiovanni said. "These are still levels we haven't seen since the early 1980s."

Auto sales provide a snapshot of American consumer demand, although the sector has badly trailed other categories of spending since the middle of 2005.

An October sales total of over 10 million vehicles would mark an improvement from the September sales rate of 9.2 million. But it would also represent a single-digit percentage drop from the 10.8 million sales rate a year earlier.

Sales have tumbled 27 percent so far this year, underscoring concerns that any recovery for the battered auto sector is likely to be slow and uneven.

"We can feel that there is demand, but it is very cautious demand," Asbury Automotive Group Inc (ABG.N) Chief Executive Charles Oglesby told Reuters.

The sixth-largest U.S. dealership chain forecast 2010 U.S. auto sales of 10.5 million units.

U.S. light vehicle sales have dropped severely in the last two years and are expected to total of just above 10 million vehicles in 2009, compared with 16.1 million in 2007.

The consensus view among automakers and leading forecasting firms such as J.D. Power and CSM Worldwide is that sales will rise at least 15 percent to above 11.5 million units in 2010.