Pickup trucks, traditionally the top sellers in the U.S., seemed to drive much of the business. Sales of Ford's F-Series trucks rose 19 percent, while Chrysler's Ram jumped by the same amount. GM's Chevrolet Silverado, among the oldest trucks in the market, saw a 4-percent sales increase.
Toyota and Volkswagen did well in car sales.
Yingzi Su, GM's senior economist, said the overall increase was due mainly to pent-up demand as consumers and businesses were forced to replace aging cars and pickup trucks. The average age of a vehicle on U.S. road is approaching 11 years.
"People have been holding off new purchases for such a long time, since 2008 to now," she said, adding that even though the economy is growing slowly, auto sales are seeing overall improvements.
When all automakers finish reporting results later Tuesday, sales could hit more than 1.2 million vehicles for August, up around 20 percent from a year earlier, analysts predict. The annual pace is expected to reach 14.2 million to 14.5 million vehicles, making August the second-best month of the year.
Toyota, which now has a full inventory of new cars at its dealers, continued its recovery from bad sales last year. Its sales grew almost 46 percent. Nissan's sales climbed almost 8 percent, and Volkswagen continued its staggering growth with sales up 63 percent on strong demand for the Jetta and Passat sedans.
For pickups, a better housing market appeared to be the driver: Builders are getting more permits to start home construction and they have been breaking more ground on projects.
Chrysler sold more than 25,000 Rams in August, aided by big discounts. Ford said its F-Series sales rose to 58,201, while the Chevy Silverado trailed at 38,295.
Chrysler also reported a big spike in minivan sales, with the Dodge Caravan and Chrysler Town & Country vans each rising more than 30 percent. Chrysler's 300 luxury sedan posted a 65 percent sales increase.
At Ford, sales rebounded from a poor July, driven by the new Escape and Explorer crossover SUVs. The redesigned Escape bounced back from a safety recall last month to increase 37 percent. Explorer large SUV sales were up 33 percent. Ford also said it would raise production in the fourth quarter by 7 percent to meet increased demand.
GM also recovered from a bad July, with all four of its brands reporting increases. Chevy sales were up 11 percent, led by the Cruze compact. The Sonic subcompact, which had barely reached showrooms in August of last year, saw sales jump to more than 8,700. It likely will be the top-selling subcompact in the nation again in August.
GM also said it was helped by heavy advertising on the Olympics and a full month of a money-back guarantee program for Chevrolets.
Industry analysts say U.S. auto sales are likely to keep the economy going even as it struggles to grow. The economy expanded at a tepid 1.7 percent annual rate from April through June. On Friday, Chairman Ben Bernanke made clear that the Federal Reserve will do more to boost the economy because of high unemployment and a recovery that remains "far from satisfactory."
Customers likely found good deals on 2012 models last month, especially for leases and pickup trucks. Chrysler is offering $4,289 in discounts on the Ram 1500, Edmunds said. Also, Honda raised its incentives 27 percent in August from July to an average of $1,666 per vehicle.
Buyers also were drawn out by exciting new models such as the midsize Nissan Altima and the Dodge Dart compact, Schuster said. Chrysler sold more than 3,000 Darts in its first full month on the market. The Dart is the company's first competitive compact car in more than a decade.
Low interest rates also were pulling people in. A 48-month new-car loan averaged 2.98 percent last week, according to Bankrate.com. And automakers were offering no-interest loans on some models.
Honda and Toyota once again are expected to lead the way in sales increases. Last year at this time their dealers had few models to sell because a March earthquake in Japan hobbled their factories. This year they're back to full supplies.
Sales started the year strong, backed off a little in May, but came back during the summer. Schuster expects to end the year at 14.3 million, more than 1.5 million above last year. Sales hit a recent high of 17 million in 2005. The bottomed at a 30-year low of 10.4 million during the recession in 2009.