Car sales in the state of California are expected to drop in 2006 for the first time since 2003, according to a recent report.

Sales of cars and light trucks were down 4.2 percent through September and are expected to be off 2.9 percent for the year, said Jeff Foltz, a consultant for the California Motor Car Dealers Association. Third-quarter sales were down 7.6 percent.

A sluggish economy in the fourth quarter, along with creeping interest rates, high consumer debt levels and a tepid housing market were all cited as potential causes for the slowdown. Nationwide sales for vehicles are down 2.9 percent through October, the report said.

Car sales in California have topped 2 million every year since 2002, hitting an all-time high of 2.16 million in 2005. About one of out of every nine vehicles sold in the United States is bought or leased in California.