Rising car sales are offering a glimmer of hope for the depressed international auto sector, but analysts stress that the positive data is largely dependent on temporary government bonus schemes.

The auto sector was one of the first to be hit by the global economic crisis because of a collapse in demand for cars and it is being closely watched by economists as an indicator for any signs of economic recovery.

In the United States, Ford Motor Co. reported Monday its first increase in sales in almost two years, posting a 2.3 percent increase in total sales in July to 165,279. Retail sales at its core brands -- Ford, Lincoln and Mercury -- rose nine percent to 118,197 vehicles.

Chrysler Group reported a nine percent drop in total US auto sales in July to 88,900 vehicles -- of which 76,693 were retail sales -- but said retail sales were up by 52 percent thanks to "cash for clunkers," a government-funded trade-in programme.

General Motors meanwhile posted a 19.4 percent drop in US auto sales in July but celebrated the programme, which helped boost sales for the final week of the month.

The automaker, which emerged from bankruptcy protection on July 10, said it expects its share of the retail market will come in higher than July 2008 despite a nine percent drop in retail sales to 155,569 vehicles.

France offered an upbeat assessment of its auto market, with the main auto manufacturers' group, the CCFA, reporting a 3.1-percent increase in new car sales in July from the same month last year.

Sales at France's biggest carmaker PSA Peugeot Citroen posted an impressive 11.4-percent rise and Renault sales jumped by 18.5 percent, the data showed.

But Guillaume Mouren, an analyst at market research company Xerfi, warned sales would fall after a government bonus scheme runs out later this year.

"Even if the bonus scheme is phased out gradually, there's still going to be a big fall next year," he said. "French people want to take advantage of the highest bonus and put in their orders before December 31."

Like many major economies, including Germany and the United States, France has implemented a bonus scheme for car buyers to trade in their old models in a drive to boost sales and promote more eco-friendly transport.

Germany, in particular, has seen a boom in car sales this year because of the scheme and its auto manufacturing federation was due to publish figures on Tuesday that are expected to show another rise in registrations for July.

Spain meanwhile is continuing to see a drop in sales year-on-year, although it is less steep than before, the ANFAC manufacturers' association said.

ANFAC said the latest figures, showing a total of 108,222 vehicles were registered in Spain in July, mark a "continuation of the slowdown of the decline" due to "the positive effects of direct aid on the market."

The picture for the world auto industry is still far from rosy however.

European and Japanese carmakers, including Daimler, PSA Peugeot Citroen and Honda, last week reported dismal results because of the economic crisis, although they remained upbeat about the prospects for a recovery this year.

Hopes for the auto sector are focused mainly on a recovery in Western markets and growth in key emerging economies such as China and India, while once-booming markets in Eastern Europe are still struggling with recession.

Russia's main automaker, Avtovaz, was reported last week to be considering cutting up to a quarter of its 110,000 workforce and the Czech Republic on Monday reported a 10.9-percent contraction in car output so far this year.

One government programme that is helping boost the troubled auto industry, analysts say, is US President Barack Obama's "cash for clunkers" plan, which offers owners of old cars and trucks up to 4,500 US dollars toward a new, more-efficient vehicle.

It has been described by supporters as a victim of its own success, practically burning through all of the one billion US dollars allocated to the programme in its first week after spurring the sale of about 200,000 vehicles.

The US House of Representatives voted Friday to pump another two billion US dollars into the programme. But the effort has hit opposition in the Senate, prompting Obama to invite all 58 Senate Democrats and their two independent allies to the White House for lunch on Tuesday.