The average manufacturer automotive incentive in the US was $US2,655 per vehicle sold in August 2005, down $66, or 2.4%, from August 2004, and down $326, or 10.9%, from July 2005, according to analysts Edmunds.com.

"As the new model year vehicles enter and begin to dominate the marketplace, average incentive spending falls," said the company's top analyst Jane Liu. "This decline will go on as long as the new model year vehicles are in high demand, likely until January 2006 for most automakers."

Chrysler's 2006 model year vehicles accounted for 12% of the company's sales in August, up from 7% in July. Ford's 2006 model year vehicles took 18% of the company's sales in August, up from 5% in July, and GM's 2006 model year vehicles made up 18% of the company's sales in August, up from 4% in July.

Some European brands sold more 2006 model year vehicles than 2005 model year vehicles in August: 69% of Mercedes-Benz vehicles, 57% of Land Rover vehicles and 50% of BMW vehicles sold in August were 2006 model year vehicles. On the other hand, 2006 model year vehicles captured a very small percentage of the Japanese brands' sales in August - the lowest in the industry: 3% of Honda vehicles, 1% of Nissan vehicles, and 7% of Toyota models sold in August represent the new model year.

The industry's aggregate incentives spending is estimated to have totalled $4.2 billion in August. Domestic manufacturers spent $3.3 billion or 76% of the total cost, Japanese manufacturers spent $630 million or 15%, European manufacturers spent $246 million or 6%, and Korean manufacturers spent $125 million or 3%.

Based on preliminary data, combined incentives spending for domestic Chrysler, Ford and General Motors nameplates averaged $3,650 per vehicle sold in August, down $292 from July 2005. Chrysler decreased incentives spending $302 to $3,321 per vehicle sold, Ford decreased incentives spending by $77 to $3,799 per vehicle sold in August, and General Motors decreased incentives in August by $417 to $3,718 per vehicle sold.

From July to August, European automakers increased incentives spending by $86 to an average of $2,468 per vehicle sold.  Japanese automakers increased incentives spending by $16 to a record high average of $1,252 per vehicle sold. Korean automakers decreased incentives spending by $120 to an average of $1,825 per vehicle sold.

Comparing all brands in August, Mini spent only $26 while Scion spent $96 and Porsche spent $157 per vehicle sold. At the other end of the spectrum, Cadillac spent the most, $6,227, followed by Lincoln at $5,944 and Saab at $5,883 per vehicle sold. Looking at incentives expenditures as a percentage of MSRP for each brand, Saab and Mercury spent the most, 18.3% and 15.7%, respectively, while Mini and Porsche spent the least, 0.1% and 0.2%, respectively.

Among vehicle segments, large SUVs continued to offer the highest average incentives, $4,955 per vehicle sold, while sports cars had the lowest average incentives per vehicle at $1,115. Looking at incentives expenditures as a percentage of MSRP for each segment, large SUVs were the highest, 11.2%, while sports cars were the lowest, 3.8%.