GM U.S. October sales rise 4.1 percent

DETROIT (Reuters) - General Motors Co on Tuesday posted a 4 percent U.S. sales increase for October, its first year-over-year gain since January 2008, and said the U.S. economy and car industry were showing signs of recovery.

GM said total sales rose to 177,603 vehicles in October from 170,585 a year earlier, with its Chevrolet, Cadillac, GMC and Buick brands accounting for about 95 percent of the automaker's retail sales.

The automaker, which emerged from a government-funded bankruptcy in July, said the U.S. auto industry's annualized sales for the month of October would be the strongest month since November 2008 excluding July and August, which were supported by government "cash for clunkers" incentives.

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Still, the October annualized selling rate is the second-lowest October since the early 1980s, GM noted.

The automaker cut its North America fourth-quarter production plan to 620,000 vehicles from 655,000 vehicles to take into account the shutdown of the Saturn brand following the collapse of a deal to sell it to Penske Automotive Group.

GM is in the process of dropping its Pontiac and Saturn brands and plans to sell its Saab and Hummer brands in its restructuring. Those four brands combined accounted for 9 percent of October sales.

(Reporting by David Bailey, editing by Matthew Lewis)