The U.S. government's 'cash-for-clunkers' rebate program aimed at promoting fuel-efficient vehicles generated nearly 700,000 new car sales, with Japan's Toyota Motor Corp. (7203.TO) topping the list of the new purchases, Kyodo News reported Thursday citing the Transportation Department.

Toyota accounted for 19.4% of 690,114 rebate applications worth $2.88 billion dealers submitted to the department by the deadline of Tuesday night, surpassing 17.6% logged by General Motors Co. (GM), now under reconstruction.

GM was followed by 14.4% for Ford Motor Co. F, +0.90% , 13.0% for Honda Motor Co. (7267.TO) and 8.7% for Nissan Motor Co. (7201.TO). Chrysler LLC came seventh with a 6.6% share.

By car model, Japanese vehicles occupied the top three. The Toyota Corolla was the most popular model purchased under the program, followed by the Honda Civic and the Toyota Camry. The fourth largest-selling car was Ford Focus FWD, the department said.

Four other Japanese models were among the top 10 - the Nissan Versa, placing sixth, the Toyota Prius, seventh, the Honda Accord, eighth, and the Honda Fit, ninth.

The incentive program was introduced in late July under the $3 billion budget provided by Congress. It gives $3,500 to $4,500 to people who trade in an old car for a new one with higher fuel economy. The subsidy was designed to prop up the nation's faltering car market by encouraging makers to make more fuel-efficient vehicles.

The government closed the program just one month after the introduction, as the budget ran out under a flood of applications.

"American consumers and workers were the clear winners thanks to the cash for clunkers program," Transportation Secretary Ray LaHood said in a statement. "Manufacturing plants have added shifts and recalled workers. Moribund showrooms were brought back to life and consumers bought fuel efficient cars that will save them money and improve the environment."

According to a preliminary estimate by the White House Council of Economic Advisers, the incentive program will boost economic growth in the third quarter of 2009 by 0.3-0.4 percentage points at an annual rate thanks to increased auto sales in July and August.

The program will also create or save 42,000 jobs in the second half of 2009, the estimate said.

Ford and GM recently announced production increases for both the third and fourth quarters as a result of the demand generated by the program.

Honda also said it will be increasing production at its U.S. plants in East Liberty and Marysville, Ohio and in Lincoln, Alabama.