Incentives boost car sales

Higher incentives helped fuel May's rebound in U.S. car and truck sales after weak April results, and Detroit's automakers announced new or extended promotions Friday in a bid to keep the momentum going.

Last month, General Motors Corp.'s average incentive was $2,950 per vehicle — up 6.1 percent from the same month in 2006. The automaker's sales rose 9.6 percent, and car demand was up nearly 17 percent, with an average car incentive of $2,797.

Ford Motor Co.'s incentives climbed 4.6 percent to $4,040, although that didn't move the needle enough for Ford, which was the only one of the six biggest automakers to report a sales decline in May — 6.9 percent. Ford incentives averaged $3,724 for cars and $4,201 for trucks.

DaimlerChrysler AG's Chrysler Group raised incentives 7.1 percent to an average $4,178, which helped fuel a 4.3 percent sales spike for the month. Car incentives averaged $2,530 and trucks $4,855.

Industrywide, incentives averaged $2,692 per vehicle in May, up from $2,548 a year ago.

Analysts say discounts are likely to remain a fact of life until domestic brands become more competitive with their Asian rivals. More at Detroit News