Mexico auto production to sink 20 pct in 2009-AMIA

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Mexico's automobile production fell 3.5 percent in December compared with the same month a year earlier and output could slide by one-fifth in 2009 as the U.S. recession stifles consumer demand, a Mexican industry group said on Monday.

Domestic auto production could fall as much as 20 percent this year, Eduardo Solis, the head of The Mexican Automotive Industry Association, or AMIA, told reporters.

The group also said vehicle exports in December were down 10 percent from the same month a year earlier.

Mexico builds vehicles for most of the world's top carmakers, but auto exports are dropping due to the recession in the United States -- Mexico's top trading partner.

Vehicles and auto parts account for around a fifth of Mexico's total manufactured exports.

Many analysts believe Mexico could follow the United States into recession. The government forecasts the economy will fail to grow in 2009, and the central bank has called that estimate optimistic.

Auto output for full-year 2008 rose 4 percent from the previous year, according to AMIA, while exports were up 3 percent year-on-year.