U.S. automakers are producing more cars even as weakening demand has them boosting incentives to sell ones they've already built. The result could be a glut of cars, meaning good deals for consumers but lower profits for automakers, according to a USA Today story by Earle Eldridge.

"A price war is breaking out in the U.S. auto industry," said Goldman Sachs analyst Gary Lapidus. "It's pedal to the metal at Ford plants, with new management ready to spend whatever it takes to maintain share and

volume. (General Motors) is digging in the trenches, adding shift capacity and warning of higher incentive spending. All of this is in the face of an apparent softening in demand."

Sales were off 6 percent in May from a year

ago and were off 2.7 percent through the first five months of the year.

Lapidus warns that automakers may end up spending more on rebate deals in late summer to clear out too many cars being built now. In fact, as soon as May sales numbers were out, GM, which has led the charge on rebates, added

more.

The automakers think May's big drop was a blip and have been gearing up plants on a forecast of increased demand. Through June 7, U.S. vehicle output was up 7.7 percent from a year ago, according to Ward's Automotive

Reports.