The auto bailout could cost $100 billion


General Motors Corp. (GM) and Chrysler have received $17.4 billion in U.S. funds (so far), which they received only after much congressional teeth gnashing. Meanwhile, American International Group(AIG) snaps its fingers and over the weekend and some Treasury officials give it another $30 billion -- bringing its total to $180 billion. But thanks to the worst February in 27 years, the auto industry will likely catch up fast.

February's plunge in auto sales is a result of the realization by many Americans that they can keep their current cars running longer -- and even if their cars are broken, they can't get the financing to buy a new one and they certainly can't pay cash for a car. It's just too expensive. GM's sales fell 53%, Ford Motor Co.'s (F) sales declined 43% and Chrysler suffered a 44% drop. Incentives are not working -- the average incentive per vehicle sold is up 8% to $2,914. Only Hyundai, which lets buyers give back their car if they lose their jobs- bucked the trend; its sales fell only 2%.