The price of the bottom-of-the-range Rover 200 has been cut by pounds 1,000 and the specification raised to include driver's airbag, power steering, alarm, immobiliser and stereo cassette as standard equipment.
In the Rover 400 range, reductions of up to pounds 1,750 are available on models such as the 16 value, 1.4-litre version, while the price of the basic model has been cut by pounds 1,000 - a saving of 10 per cent.
A spokesman said the price reductions were part of a campaign to reposition the model range so that the Rover 200 would compete against the Fiesta, Peugeot 206 and VW Polo rather than the Escort, Astra and VW Golf.
"We plan to attract more customers by offering better value and that means a higher specification for a lower price," he said.
However, some motor industry observers saw it as an act of desperation that would merely increase Rover's losses this year.
Last month it captured only 5.89 per cent of the market, falling back to sixth place in the market behind the likes of Peugeot, Renault and Volkswagen, with sales of just 10,366 cars. Total Rover sales in the first four months of the year are running at 89,484 - down by 29 per cent on the same period last year.
Rover said this was largely due to a run down in several of its model ranges. The Rover 100 is no longer on sale, while the Rover 600 and 800 ranges are being phased out in readiness for the launch later this month of the Rover 75 executive car.
The overall car market was up by 1.8 per cent in May at 175,898, according to figures released by the Society of Motor Manufacturers and Traders.
Based on sales in the first four months, which were 3 per cent higher at 994,887, the SMMT has raised its forecast of sales for the year from 2.05m to 2.1m.