Both GM and Chrysler say bankruptcy imminent without more aid.
U.S. auto sales continued their free fall into February, as big rebates and low-interest financing failed to lure people back into car dealerships and showrooms.
Today General Motors reported that its sales slid 53 percent in February compared with the same month a year ago, and Chrysler sales dropped 44 percent.
Ford's sales tumbled 48 percent, despite distinguishing itself from cross-town rivals in recent months by keeping the company afloat without federal aid.
"The economic and competitive environment remains challenging," said Ken Czubay, Ford vice president for sales and marketing, in a statement. "Ironically, these times provide the best opportunity to distance Ford from the competition."
The steep drop puts additional pressure on GM and Chrysler, who are rapidly burning through cash while generating very little income from sales. After receiving $17.4 billion from the government in December, both companies say they will still be on the verge of bankruptcy without another cash infusion from the Treasury Department on March 31.
If you think this is just U.S. autos, wrong. Toyota is now in talks with Japan, desperately seeking loans.
What's the reality here? Well, no income, no new shiny car.
Why is it wages, income, jobs is constantly ignored in most of the financial press. What happened when the connection between a steady paycheck, disposable income was decoupled from all other economic reality?
Recenlty I saw a show about Japan's dire employment conditions. They threw away lifetime employment, bring in foreign guest workers, made people temporary and now their own middle class is imploding.