Aug. 6 (Bloomberg) -- Nissan Motor Co. helped boost U.S. sales 8.5 percent last month while its biggest rivals posted declines by spending more on incentives, according to a market research firm.

Japan's third-largest automaker raised its average incentive spending per vehicle 29 percent to $3,142 from June to July, said Charlie Vogelheim, automotive development vice president for J.D. Power & Associates in Westlake Village, California. That compares with $2,869 industrywide, a 4 percent increase from June.

The sales increase made Tokyo-based Nissan the only one of the seven biggest automakers in the U.S. to post a July gain as demand industrywide fell to its lowest level in 16 years. Toyota Motor Corp., the largest Asian automaker, declined 12 percent, and General Motors Corp., No. 1 in the U.S., was down 26 percent.

The automaker, No. 6 in U.S. sales, is trying to clear dealer lots of older 2008 models to make way for 2009 versions, said Darryll Harrison, a spokesman for Nissan in Nashville, Tennessee. ``Just like other automakers do, we make strategic adjustments to our incentives in a given month,'' he said.

Nissan's light-truck sales increased 18 percent last month, while the industry posted a 25 percent drop. One of them, the new Nissan Rogue sport-utility vehicle, accounted for 6,525 deliveries. Nissan sold 6,022 Rogues in June while its truck sales plunged 36 percent.

The July sales increase ``appears unsustainable,'' because Nissan raised incentives on its light-truck offerings by $1,600 compared with June, said Deutsche Securities Inc. analyst Kurt Sanger in a note today. ``It did serve a purpose of clearing some 15,000 units of inventory,'' he said.

Nissan increased sales of its Xterra sport-utility vehicle in July by 17 percent from a year earlier to 4,898 units, almost double its monthly average of 2,540 during the first half. Purchases of the Quest minivan rose 15 percent to 3,010, almost double its first-half average.

Raising incentives can encourage consumers to buy vehicles sooner than planned. The move also can drain earnings. Nissan reported a 43 percent drop in second-quarter profit due partly to a writedown for the value of leased vehicles.

To contact the reporter on this story: Greg Bensinger in New York at gbensinger1@bloomberg.net

Last Updated: August 6, 2008 10:34 EDT