Plagued by a near-bankrupt U.S. auto industry, manufacturing activity in the Midwestern U.S. plunged to a nearly 15-year low in January, data from the Federal Reserve Bank of Chicago revealed Wednesday.

The Chicago Fed Midwest Manufacturing index dropped 5.9% in January to a seasonally adjusted level of 85.6. That's the lowest reading since July 1994, the Chicago Fed reported.

Data compilers also revised downward its December index to 91.0, from their initial estimate of 92.2.

The regional index was down 21.8% from January 2008, falling at a faster clip than the 13.0% decline felt nationwide.

The same index was also weaker than the Federal Reserve Board's industrial production index for manufacturing, which declined 2.6% in January.

The auto sector was by far the weakest of the four components that make up the manufacturing index.

The five-state Midwest region includes Michigan, which is home to the nation's largest auto manufacturers. President Barack Obama's auto task force is looking at ways outside of bankruptcy court to restructure severely struggling General Motors Corp. (GM) and Chrysler LLC.

The auto sector index tumbled 20.0% in January on the heels of only a 1.8% decline in December. The January index reading of 49.5 was the lowest since August 1991, according to the Chicago Fed.

Compared to year-ago levels, regional output was down 42.2%, versus a 24.3% decline nationwide. In January alone, national auto output fell 10.1%, a much slower contraction than was experienced on a regional basis.

In addition to Michigan, the index encompasses Illinois, Indiana, Iowa and Wisconsin.

The Chicago Fed counts the number of hours worked to measure changes in regional activity.

The Chicago Fed is scheduled to release its February index April 6.

-By Howard Packowitz, Dow Jones Newswires; 312-750-4132; howard.packowitz@dowjones.com