GM, Ford sales nosedive again in February

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Just call it MOTS: more of the same. General Motors' (GM) and Ford's (F) February sales came in at abysmal levels, as expected, as the Big Three attempt to make their case for additional federal assistance.

GM's February light vehicle sales (cars and light trucks) fell 53% to 126,170 from 268,737 a year ago. Ford's fell 48.2% to 96,044 cars and trucks from 185,294 a year ago. GM and Ford's shares were essentially unchanged on the news, but investors should keep that in perspective: the pair's shares have fallen so much, they're now at levels that reflect little investor confidence in their operations. GM's shares rose seven cents to $2.08, while Ford rose one cent to $1.89.

GM's car sales nosedived 50% to 53,813, and light truck sales plunged 55% to 72,357.

Ford's truck sales, which include the popular F-Series pick-up, plummeted 51.6% to 61,366. Ford's car sales fell 40.8% to 34,678.

Auto Sector Analysis: The February unit sales totals were not a surprise -- and they reflect the U.S. recession, consumers' concerns about potential, additional lay-offs, and of course uncertainty regarding the operational fate of the Big Three.

Bottom Line: The February sales statistics are not game changing, for or against, regarding potential future Congressional assistance for the Big Three.

The argument in favor of the package: idling the huge assets and number of employees involved in the auto sector would further hurt a weak U.S. economy. It's hard to envision Congress not allocating more loans and related assistance.

The argument against the package: Fed Chair Bernanke was up on Capitol Hill again Tuesday indicating that more bank bailout money will be needed, in addition to aid for insurance giant and credit default swap king AIG (AIG). Significance? Congress is getting bills left and right -- the U.S. government has allocated more money and issued more guarantees in the last two years than at any time since, perhaps, World War II funding.

The view from here argues GM, Ford and Chrysler will get more funds, but Congress will want a large equity stake, other taxpayer protections and other performance results for the taxpayers' money.
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