Analysts within the automotive industry are forecasting that April may show encouraging figures for growth in the industry despite the difficult consumer climate.

According to Merrill Lynch Automotive research April sales will increase significantly on figures for March with a number of financial deals and incentives, such as General Motors' revival of zero per cent interest for 60 months, proving effective.

In particular experts are suggesting that the damaging effects of war, which was expected to result in a slump in demand as consumers stayed away from the showrooms, may not have materialised.

'Barring an unexpected month-end rush of sales, we must conclude that the CNN effect didn't influence March sales very much,' said David Healy, an analyst with Merrill Lynch Automotive research.

However, experts warned that the trend was unlikely to be prolonged, with most predicting sales would continue to decline in the medium term.

'April demand is stronger than March's, but no great shakes given the acceleration in incentives,' reflected Merrill's John Casesa.

'It's a reminder that industry fundamentals are getting worse, not better, suggesting that the current rally will be short-lived,' he added.