French new car registrations in January dropped 11.9% to 154,223 from 175,107 in January 2003, CCFA automobile association data showed - sales slid 7.7% on a comparable business days basis -- the seventh straight monthly fall, according to Reuters.

Car sales in the eurozone's second biggest economy skidded 6.3% last year as worries over France's high jobless rate shook consumer confidence and capped spending on big-ticket items, the report noted.

Commerzbank autos analyst Adam Collins told Reuters: "This is a poor start to the year. We are still not seeing a turn in the French consumer...which is bad news for those expecting a recovery."

Renault sales fell 11%, while PSA Peugeot Citroen sales dropped 13.7%.

Reuters said unemployment in France rose to 9.7% in December -- a near 3-1/2 year high -- suggesting a recovery in spending on cars may still be some way off despite pricing on a par with European rivals.

The news agency noted that French motorists have been slower than their counterparts in Germany and Spain to return to showrooms after an industry-wide downturn, and most analysts do not expect a decisive upswing until at least the second quarter.

Some analysts reportedly say that apart from the launch of Renault's popular Megane family range, new product offerings from the major French pair of carmakers has otherwise been slim over the last year, and that this could be slowing sales.

They also cited France's high saving rate, and unpopular public reforms, which could be dampening consumer confidence, Reuters said.

The news agency noted that Renault has said it expects the French market to grow 3% this year while PSA is more cautious, predicting flat sales in 2004.