Analysts have warned General Motors and Ford Motor that planned cuts in vehicle production could result in more costly cuts early next year.

They also said the proposed cuts will fail to trim high inventories.

The two firms last week posted weak US sales for August, capping a weak summer with their third straight month of lower sales, despite higher consumer incentives.

Hurricane Charley's damaging path through Florida, high-energy prices and falling consumer confidence also hurt sales results.

The poor figures lead to both firms cutting planned fourth-quarter production - 6.8 per cent and 7.8 per cent below year-ago levels, respectively.

"We don't expect the production cuts to solve the industry's inventory problems, raising the specter of additional cuts in 2005," said Deutsche Bank analyst Rod Lache, who also cut his earnings outlook on GM.