The pricing battle between major vehicle makers in the United States intensified on Wednesday when General Motors and Ford began offering more cash to customers on new cars and trucks.

According to Reuters, GM’s latest programme targets current GM owners, who can qualify for up to $US5,000 in cash on most 2003 and 2004 vehicles – the new offer, which runs until August 2, can’t be combined with existing incentive deals.

Speaking on Wednesday at GM’s annual shareholder meeting in Wilmington, Delaware, GM chairman and chief executive Rick Wagoner reportedly said incentives remain an effective tool for generating showroom traffic – but a nagging drag on profits.

“I suspect for at least the next while, as long as the economy is still coming back as opposed to running on full steam, we’re going to have to battle it out in the market place a little tougher than we might like,” Wagoner said, according to Reuters.

Ford, meanwhile, has raised the customer cash available on recently redesigned Freestar minivans by $1,000 to $5,000 – the offer is restricted to customers who finance the vehicle through Ford’s credit arm though those who don’t use Ford’s credit agency are eligible for a smaller discount.

“It’s a reflection of tough sledding in the minivan market despite good product,” Ford spokesman Jim Cain told Reuters.

The news agency noted that, like GM, Ford continues to offer discounts on a variety of other vehicles, including $1,500 to $3,000 cash rebates on pickups.

DaimlerChrysler AG’s Chrysler Group also has several ongoing deals to spur sales, though a spokesman told Reuters no enhancements were announced on Wednesday.