Auto sales took a huge dip in May; much lower than what analysts expected. The May auto sales are a reflection of consumers’ hesitance to purchase higher priced vehicles amidst the weakening economy.

Because the supply of cars has tightened after the Tsunami and a series of earthquakes hit Japan, a lot of companies raised their car and truck prices. Many investors and analysts have now concluded that the strategy of many motor companies, Toyota Motor Corporation and Honda Motor Company Ltd included, backfired.

Automotive makers based in the United States General Motors Company and Ford Motor Company released their sales report on Wednesday. Both companies experience their lowest sales in eight months.

Gary Bradshaw, a manager from Hodges Capital Management, said that the car companies may have increased their prices a little too early, especially because the consumers are not yet ready and are just recovering from the economic crisis.

Don Johnson, General Motors sales chief, said that car sales in general would probably be below 13 million for the next several months. However, both Ford and GM are steadfast in their forecast that the 2011 sales will be between 13 and 13.5 million annual sales.

Johnson added that a lot of people are asking if they are actually on track for their 3 million annual sales goals, and he honestly said that as of the moment, they are not. However, they remain hopeful as the end of the fiscal year comes to a close.

Carmakers are building a strong start to 2011, relieving worries about slower growth demand in the Asian markets that brought sales away last year, including the rough recovery in western markets.

Hyundai Motor from South Korea said global sales increased 14 percent in January. Vehicle manufacturers from India reported sales increase between 14 and 22 percent.

Also, the number 1 seat belts to airbags group in the world, Autoliv predicted that a recovery in North America would help the sales this year.

The sales data released from French passenger car makers on Tuesday revealed an increase of 8.2 percent year-on-year to 185,603 units in January. France’s last effects of a scrapping promotion continued to enhance the figures. The promo ended in December, but cars purchased with the bonus can be registered up until March.

However, the growth in India and China that has persisted carmakers has recently been cooling off. The uncertain recovery in advanced markets such as Europe and United States has always remained as a concern, analysts said.

In the U.S., auto sales lost their driving force in the final weeks of January, the auto executives and a leading analyst warned on Monday. They want to set the stage to soften the start of 2011 rather than what automakers expect when they release their January sales report later on Tuesday.

According to Flavien Neuvy, head of Cetelem’s automobile industry research department, there won’t be any surprises until March. He added that the question will be afterward, between April and September when there will be a lot of uncertainty. Cetelem is a consumer credit organization.

However, sales on light commercial vehicle increased 8.6 percent in January.