But carmakers will have to wait until 2006 for profits to return to peak levels, the executives warn.

The 100 people surveyed by audit and consultancy firm KPMG - from 19 carmakers and 81 suppliers - saw Asian manufacturers as 2004's big gainers.

Detroit's drought could finally come to an end too, they said, as the need for heavy incentives slackened.

The improved expectations come just days ahead of the highlight of the US industry's year, the North American International Auto Show, which kicks off in Detroit on Sunday.

But it is not all good news either for the US or the industry as a whole, the KPMG survey found.

Of the 100 executives questioned, 36 said 2003 would prove to have been the worst year for profits in recent times - and 13 said 2004 would be even worse.

Meanwhile, the prediction of 2006 for a return to peak profitability is a repeat of the consensus in the survey a year ago.

That year, executives foresaw that the business would be back in a boom by 2005.

And despite falling incentives - only 38 of the respondents saw the need to bribe customers into the showrooms increasing, against 63 in 2001 and 48 in 2002 - US carmakers are set to keep losing market share.

The improving US economy is instead likely to prove good news for Asian carmakers, particularly Toyota - now the number three seller ahead of Chrysler - and Nissan but also Korean marques.

European vendors are set to gain less from an expanding US market, those surveyed said, predicting at the same time that merger activity in Europe would accelerate.