1:00PM New York—U.S car sales fall in December, Toyota replaces Ford as number two U.S. auto seller.

U.S car sales were stuck in low gear in December, as Toyota Motor Corp reported its 12 straight year gain and eclipsed Ford Motor Co to number two positions by auto sales in 2007. General Motors still leads the U.S. auto sales.

Monthly sales of cars and light trucks dropped 4.4% at GM, and were down 6% on the year. Toyota sales declined 1.7% while sales at Ford dropped 9.2%. Ford lost its number two position that it held for 77 years. For the year Toyota sales increased 3.1% and sales at Nissan rose 4.8%.

Chrysler LLC, meanwhile, reported an annual sales decline of 3.1% although December sales were fractionally up 0.5%.

At Nissan Motor Co, monthly sales dropped 2.4%, as Honda reported a gain of just 14 vehicles in the month helped largely by sales of its Accord and Civic brands. Honda said sales grew 2.8% in 2007.

Overall, in 2007, U.S auto sales declined 2.5% to 16.1 million including trucks and cars.

Despite growing concerns about fuel economy, car sales fell only 2.6%, and truck sales fell 2.3% in the year.

For 2007, Toyota sold 2.62 million cars and trucks against Ford's 2.572 million. GM sold 3.82 million.

In December, GM said sales of cars and light trucks stood at 319,837 compared with 334,501 reported in the year ago period. Sales of light trucks dropped 8% to 203,254 while car sales dropped 10% to 116,583, the company said. Consumers showed weaker interest in pick-up trucks and sport-utility vehicles.

Ford's car sales plunged 24% in fiscal 2007, as some models like the Ford Mustang aged and a new Ford Taurus sedan was unable to match the volumes of the older version. Ford also cut rental-car sales by 32% over the year. Truck sales fell 5%. Ford sold 210,855 vehicles in December.

Toyota sold 224,399 vehicles in the month. The passenger-car sales fell 1.7% to 121,581 while light-truck sales fell 1.8% to 102,818. Toyota division sales for December fell 0.7% to 189,844. Lexus division sales fell 7.2% to 34,555.

Chrysler LLC sales rose 1% in December helped by brisk sales of the new Dodge Caravan minivan sales jumped 51%. Chrysler sales sank 3% for the year as falling truck and SUV sales erased gains in the car sales.

Honda, the second-largest Japanese automaker, sold 131,792 vehicles in December and 1.55 million vehicles for the year.

In December, Nissan sold 89,555 vehicles while full-year sales gained 4.8% to 1.07 million.

The major automakers, GM, Toyota and Ford warned of a sluggish 2008 amid consumer concern of high-energy prices and a weakening U.S economy.

In a conference call Thursday, officials at Toyota lowered growth forecasts to 1% and 2% in 2008 from the initial forecast of 3%.

Toyota said growth in hybrid vehicles sales could slow in 2008, after rising in 2007 almost exclusively on one model. Sales of the Prius, the best-selling hybrid by far, increased 69.4% in 2007 to 181,221. Toyota has targeted to sell almost 275,000 hybrids in 2008, about the same as 2007.

GM said it plans to build 950,000 vehicles in the first quarter in North America, down about 11% from a year earlier. In the fourth quarter, GM North America built a higher-than-expected 1.042 million vehicles, down 6% from a year ago.

Ford said it expects the economic atmosphere to ""remain challenging"" in 2008. The company predicts the U.S. annualized auto sales in the range of 15.5 million to 16 million in the first half of next year, with light vehicle sales ranging from 15.2 million to 15.7 million.

Ford traded down 29 cents at $6.45 and GM fell 56 cents to $23.36 at 1:03 PM in New York.