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As auto sales have declined in recent months, automakers have responded with heavy discounts on most vehicles. It hasn’t worked. At the beginning of each month for the last year, we’ve seen a new round of incentives meant to draw buyers back into showrooms. At the end of each month, we’ve seen reports of sales declines. Now, it appears, we may see a major automaker give up on attempts to use incentives to reverse the sales slide.

The Detroit Free Press reports, “General Motors will slash spending on marketing in North America, including vehicle incentives, by $800 million this year because of lower sales volumes.” The automaker announced its new marketing plan late yesterday.

The New York Post adds, “In December, GM said it would remove $600 million from its marketing budget over the next four years. That figure, however, didn’t include incentives, making it tough to compare with the latest plan.”

The General is taking other steps to cut marketing expenses. Bloomberg notes, “General Motors Corp. may not renew its 25-year sponsorship of the NCAA men’s basketball tournament after this season.” The company recently ended a long-running sponsorship agreement with golfer Tiger Woods, and took pains not to call attention to its sponsorship of this year’s Super Bowl. After announcing a loss of more than $30 billion for all of 2008, and requesting additional bailout funds from the U.S. government, the company faces more calls to cut spending.

The immediate consequences of the announcement aren’t yet clear. All major automakers are due to report sales results early next week. If tradition holds, they’ll follow those announcements with a new round of low-rate financing offers, cash-back rebate programs and price discounts. General Motors is certain to end the “President’s Day Sale” discounts they’ve been running throughout February and with yesterday’s announcement, we may to see a much less aggressive round of discounts for March.

We will certainly see GM offer fewer leases. GM Chief Financial Officer Ray Young told Automotive News that “GM had to use a lot of incentives in the fourth quarter to offset the lack of credit from GMAC, but still eliminated leasing in Canada last year and is reducing leasing in the U.S.” He added, “That’s an expensive form of incentive.”

If you’re interested in a GM vehicle, keep in mind that prices may be going up at the company rolls back its incentive programs. If you’re interested in a competitor’s vehicle, you may want to watch closely to see if other automakers follow GM’s lead in cutting incentive from their marketing budgets. While you still car, research the best car deals with U.S. News’ car rankings and reviews.