Carmakers see upturn in US sales

Ford reported sharp rises in its August sales

Car makers have generally reported sharp August sales growth as they prepare for life without a popular $3bn (£1.8bn) car scrappage scheme.

Ford enjoyed a 17% sales jump from the same month a year earlier, which it said had been driven by the government-funded "Cash for Clunkers" incentive.

General Motors (GM) posted a 20% drop in year-on-year sales but said they had risen by 30% from July this year.

The rebate scheme, which has now ended, has been seen as an industry life-line.

CASH FOR CLUNKERS Car owners can gain a voucher worth $3,500 for trading in a vehicle getting 18 miles per gallon or less for a new car getting at least 22 mpg Car owners can gain vouchers of $4,500 for those trading in a car getting 18 mpg or less in exchange for a model that gets at least 28 mpg The Car Allowance Rebate System is based on similar schemes in the UK, France, Germany, Italy and Spain that have boosted new car sales

The programme was initially only allocated $1bn but a further $2bn was injected earlier this month - leading to a total of 700,000 sales.

Some analysts have expressed concern that the scheme, which has boosted car sales since it was unveiled last month, was being shelved too early.

Under the terms of the programme, owners of old cars and lorries gain up to $4,500 towards a new vehicle in exchange for their old model.

The "clunkers" initiative was inspired by similar schemes in Europe.

It has been credited with helping auto sector workers return to their jobs, while taking old, polluting cars off the road.

Asian carmakers saw their market share lifted, fuelled by a demand for smaller vehicles. Toyota reported a 6.4% sales increase from a year earlier, while Honda attributed its 9.9% growth to its more fuel-efficient models.

Ford also said that its "greener" vehicles, including the Focus and hybrid versions of the Fusion and Milan sedans and Escape and Mariner sport utility vehicles - had posted record sales in August.