Toyota Sees Flat 2009 US Automobile Market

Consumer confidence is the biggest challenge to Toyota right now as the U.S. goes through a downturn, said Toyota's North American sales chief, noting that he expects the U.S. auto sales market to be about flat in 2009 overall.

"What makes the industry most difficult right now is consumer confidence," Toyota's Jim Lentz told reporters at an event near Detroit. "We are probably going through a recessionary period."

"We are in the middle of the storm right now," he said, adding that he could not predict when the industry difficulties would end, but believed the future of the industry is strong.

Lentz said Toyota dealers were in good shape despite the difficult period, and a recently launched zero percent incentive program was leading to some increase in traffic.

Zero Percent Financing May Go On

Toyota could extend its offer of interest-free loans to U.S. consumers beyond the scheduled Nov. 3 expiry, Lentz said on Thursday.

"We will see how things are going," Lentz told Reuters in an interview.

Toyota began offering interest-free loans earlier this month across most of its lineup in a rare move follows a surprising 32 percent slide in its U.S. sales in September, its steepest drop in decades.

Lentz said traffic at Toyota dealerships has been hit by the sharp decline in consumer confidence.

"I don't think we are losing business in our dealerships because of lack of credit for consumers," Lentz said.

The global credit crunch and turmoil in financial markets are affecting the  automaker's business "more from a consumer confidence standpoint," he said.

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