Aug. 3 (Bloomberg) -- Honda Motor Co. led gains in shares of Japanese automakers after a report showed their U.S. sales surged, as discounts by Ford Motor Co. and DaimlerChrysler AG helped draw consumers to car showrooms.

Sales for Japanese and South Korean automakers rose 9.1 percent to 598,542 cars and light trucks from last year, with gains of 15 percent for Nissan, 10 percent for Honda and 8.1 percent for Toyota. The Asian companies' combined market share fell to 33.1 percent in July from 35.3 percent, the first consecutive two-month slide since 2002, Autodata Corp. said.

Asian carmakers are seeking to maintain profits on their U.S. sales by not matching discounts offered by General Motors Corp., Ford and Chrysler, which include offering buyers the same price their employees pay. Toyota's U.S. sales chief Jim Press said a ``rising tide of bargains'' boosted demand for all carmakers in the world's biggest car market.

Asian carmakers are ``growing sales without having to give too much away in terms of discounts,'' said Joe Phillippi, an analyst at AutoTrends Consulting in Short Hills, New Jersey. They aren't ``too worried about market share.''

Shares of Toyota, Japan's biggest carmaker, rose 30 yen, or 0.7 percent, to 4,280 at 12:15 p.m. Tokyo time. Honda, the third- largest, advanced 110 yen, or 1.9 percent, to 5,900. Nissan, the second largest, climbed 10 yen, or 0.9 percent, to 1,177.

U.S. Carmakers

Industry-wide sales rose 16 percent to a 1.81 million, Autodata said. July's annualized sales rate of 20.9 million was the second-best month ever, behind 21.3 million in October 2001.

Sales rose 29 percent at Ford, 25 percent at DaimlerChrysler and 15 percent at GM. GM, Ford and DaimlerChrysler's Chrysler raised the combined market share of their U.S. brands 2.9 percentage points to 61.1 percent, according to Autodata.

Discounts that ``helped to clear the inventory on the dealer lots'' raise ``the question of the profitability of the companies,'' said Daman Blakeney, New-York based analyst at Victory Capital Management Inc. ``We've seen this in 2001 right after 9/11. Three to four months following that period of zero- percent financing, sales dropped about 35 percent. So there's definitely going to be a pullback.''

Toyota and Nissan each said July was their best sales month ever, and Honda said it was the second best. Hyundai Motor Co., South Korea's largest automaker, didn't match the discounts and also said July was a record sales month, with an 11 percent increase.

Toyota, Honda

Toyota, which said it would invest $50 million more at a plant being in built in San Antonio to make Tundra pickups, sold 216,417 Toyota, Lexus and Scion models in July, rising from 200,206 a year earlier. Gains came from its Prius hybrid-electric hatchback, Sienna minivan, Tacoma pickup and Lexus GS sedans. Market share for Toyota, fourth in U.S. sales, fell 0.9 percentage point to 12 percent.

A ``rising tide of bargains lifted the market industrywide,'' said Toyota's Press in a statement. ``The coming months will test the industry's seaworthiness.''

Honda said its sales increased to 143,217 from 129,872. The gains were led by the Pilot and CR-V sport-utility vehicles, the new Ridgeline pickup and the Acura luxury brand's TL and RL sedans and MDX sport-utility vehicle.

The Tokyo-based company's market share dropped 0.4 point to 7.9 percent. Honda ranks fifth in U.S. sales.

Nissan, Hyundai

Nissan sold 107,300 vehicles, up from 93,297 a year earlier. The automaker benefited from demand for Altima sedans, Pathfinder, Murano and Armada SUVs and Titan pickups, Jed Connelly, senior vice president for North American sales, said in an interview. Nissan's market share fell 0.1 point to 5.9 percent. The Tokyo-based company is sixth in U.S. sales.

Hyundai sales rose to 44,431 vehicles from 40,125 a year ago. The Seoul-based company's U.S. market share fell 0.1 point to 2.5 percent.

The largest Asian brands continue to ``generate more customer traffic in the showroom and more excitement around their products,'' said Blakeney of Cleveland-based Victory Capital. The U.S.-based carmakers ``must continue to try to meet that challenge to be competitive,'' he said.

Kia

Kia Motors Corp., a Hyundai affiliate, said it sold 26,052 vehicles, up 10.2 percent from a year ago. Kia's market share slipped 0.1 point to 1.4 percent.

Some automakers, including Toyota, Honda and Nissan, adjust percentage changes in sales to reflect one less selling day last month compared with July 2004. The adjustments are meant to account for days when some dealerships close, such as Sundays or holidays, compared with a year earlier.

On that basis, there were 26 selling days last month and 27 a year earlier. Percentages used in this story aren't adjusted.

Toyota's U.S. shares rose 66 cents to $76.95 in New York Stock Exchange composite trading at 4:18 p.m. Honda's gained 36 cents to $26.20 and Nissan's rose 12 cents to $21.03. Hyundai doesn't list shares on a major U.S. exchange.

Mazda

Mazda Motor Corp., a Ford affiliate, sold 24,820 vehicles, up 5.7 percent from a year ago. Gains were led by its Mazda3 and Mazda6 cars, the company's U.S. unit said in statement. Mazda's market share was 1.4 percent, down 0.1 point.

Sales at Subaru, the automotive brand of Japan's Fuji Heavy Industries Ltd., rose 2.1 percent to 17,959. The company, 20 percent owned by GM, had market share of 1 percent last month, down 0.1 point, according to Autodata.

Among brands with less than a 1 percent share of the U.S. market, Mitsubishi Motors Corp. sold 10,376 vehicles, down 7.3 percent from a year ago. Suzuki Motor Corp., 20 percent owned by GM, sold 7,125, up 10.2 percent from a year ago. Isuzu Motors Ltd., a Japanese truck maker affiliated with GM, sold just 845 SUVs and pickups, down 69 percent from a year ago.

To contact the reporter on this story: Alan Ohnsman in Los Angeles at aohnsman@bloomberg.net

Last Updated: August 3, 2005 00:19 EDT