It should not come as too big of a surprise, but American auto maker Ford Motor (NYSE: F) announced today that its sales fell by 5.1% in September.

Following this summer's widely popular "cash for clunkers" program, it was some what expected that demand would weaken during September as so many people had just recently purchased new cars to take advantage of the government program.

Layoff announcements hit their lowest level since March 2008 last month, signaling market stabilization. Global outplacement consulting firm Challenger, Gray & Christmas Inc. put the number of cuts at 66,404 for September, a 13% decline from July's 76,456. Year-over-year, the number of layoffs announced is down 30%, and September was the fourth month in a row in which job cuts fell relative to the same month a year earlier.

Planned job cuts reached 240,233 for the third quarter of 2009, according to Challenger, its lowest level since the first quarter of 2008, when there were 200,656 planned layoffs. For the third quarter of this year, job cuts fell 24.5% from the previous quarter's 318,165, and it's off 16.3% from 287,142 in the third quarter of 2009. At the beginning of 2009, the planned layoff rate reached a seven-year high of 578,510. Since then, the planned layoff rate fell 58.5%.

The past couple of months there has been a lot of news over the government's recent "cash for clunkers" program, which was wildly more successful than anyone could have imagined, but left dealer lots short on inventory. General Motors dealers are still dealing with low inventory and have requested more cars to meet recent demand.

According to the Detroit News, General Motors dealers have requested that the company ship as much as four times as many cars as the company had planned to build in October.

America's Car-Mart, Inc. (NASDAQ: CRMT) surprised Wall Street this morning with stronger-than-expected quarterly earnings. The auto retailer banked a first-quarter profit of $7 million, or 60 cents per share, up from 45 cents per share in the year-ago period. Revenue climbed 11% to $83.8 million, buoyed by an 8.5% jump in same-store sales.

Both figures were better than analysts expected, with consensus estimates calling for a profit of 41 cents per share on $78.0 million in revenue. The company added to the glad tidings by reporting that its provision for credit losses dipped to 19.5% of sales, compared to 20.9% in the same quarter last year.

The U.S. Government's 'Cash for Clunkers' program ends today. It won't be clear for some time whether the program was successful or not in stimulating the auto industry but it was certainly popular with buyers. As the program ends, will the rally in auto retailing stocks also come to a close?

Interestingly, although the program runs through the end of business on today, some dealers stopped using the rebate program on Friday the 21st. For example, AutoNation, Inc. (NYSE: AN) is a publicly owned auto retailer that stopped offering the program to buyers on Friday. Perhaps management has concerns about the government being willing to pay the rebates on time.

Everyone knew that the government's "cash for clunkers" program would be enticing to potential auto buyers, but no one, including the U.S. government could have predicted just how popular the program would be.

Auto makers and dealers have seen a vast response to the program, but now some dealers are starting to wonder when the government is going to keep its end of the deal, and have decided to remove themselves from the popular program.

Share of insurance company Progressive (NYSE: PGR) are moving higher this morning following better-than-expected numbers for its second quarter.

Going into this mornings earnings announcement analysts had been looking to see the nation's fourth largest insurer post earnings of 36 cents per share, but the company surprised to the upside with an actual 37 cents a share for its most recent quarter.

Car sales in the United States might be struggling, but in China, they are moving product. Passenger vehicle sales spiked 48% last month, its biggest gain since February 2006. Chinese buyers picked up 872,900 cars in June 2009, according to the China Association of Automobile Manufacturers, and total auto sales (with buses and trucks included) climbed 36% to 1.14 million year-over-year.

Government officials are proclaiming the country's "downward slide" over, and aggressive goals are being set. The full 2009 vehicle sales forecast was raised from 10.2 million to 11 million, as sales for the first half of the year were up 18% year-over-year to 6.1 million.

If you compare last month to May 2008, then Ford Motor Company (NYSE: F) looks pretty shaky: the American auto maker posted a 24% dip in sales year over year. However, the picture starts to look a lot better once you compare April and May of this year.

All in all, Ford sold 161,197 vehicles last month in the U.S.. Yes, this was 24% off the pace it set last year at this time, but it does mark a pretty impressive 20% jump over its numbers during the previous month, as the company was able to take slight advantage of its competitors' financial woes.

For years China has been the world's leading manufacturer, and they are hoping to take that momentum into the auto industry.

When you think of foreign cars you would like to own, chances are that it is not a car made in China. The Chinese have fallen behind on gas powered cars, so they made a brilliant decision... just try to be the leader of the next industry evolution. They are looking at hybrid and electric powered cars.

There's not much to like about the U.S. auto industry right now. But, there are still some success stories. An example is DealerTrack Holdings Inc. (NASDAQ: TRAK), which provides a variety of web-based systems to help auto dealers improve their performance.

The fact remains that the environment is still tough for the company, which reported its Q4 numbers. Revenues came in at $54.7 million, which was down from $60.7 million. There was a net loss of $1.1 million, which compares to a net gain of $4.1 million in the same period a year ago. Then again, the company was able to generate cash net income of $6.2 million in Q4.

Bloomberg reports that President Elect Barack Obama's transition team is taking a hard look at the possibility of a prepackaged bankruptcy for the Detroit's troubled automakers.

In a prepackaged filing, companies like General Motors (NYSE: GM) would head to the bankruptcy court with agreements already worked out with the major constituencies: workers, suppliers and lenders. Going in with a plan could cut down on some of the fear and uncertainty surrounding the filing and cut down on the time it would take for the company to work its way through the courts.

It's good to see that Obama is taking a sane, realistic approach to an auto industry bailout. There has been concern that the new administration would be too generous in the terms -- and stones will fly if a GM workout is done with anything other than a bankruptcy filing. Bloomberg adds that "the president-elect earlier urged Congress to approve as much as $50 billion to save automakers, using the model of Chrysler's bailout in 1979."

Right: because that one worked so well that they're coming back 30 years later -- billions in excess compensation later. It's true that the Chrysler loan was paid back quickly, but it allowed the company to buy time and not really confront any of the long-term problems that have proven to be its undoing.

Hopefully Obama will listen to his more conservative advisors and push for the bankruptcy option. It's the only one that makes sense.

As GM goes, so goes the nation. It may seem like that is all too true right now, but it's not.

General Motors (NYSE: GM) has been a slow-motion train wreck for a generation.

Former CEO Roger Smith blew hundreds of billions in automation that forgot about workers and did not work. The company received import protection and a waiver of regulations from Uncle Sam to generate huge profits in SUVs, and it reinvested the money in excessive contractual obligations to already coddled workers currently earning in excess of $70 an hour.

And Ford (NYSE: F) and Chrysler were not too far behind.

Congress is now debating some form of bailout in addition to the $25 billion for re-tooling. The structure and future of this bailout is uncertain and, while I'm in the minority, I see nothing happening pre-Obama except a possible GM bankruptcy filing.

Many middle-of-the-road Americans, including many day-to-day Democrats and independents, want to see GM go through a prepackaged bankruptcy.

And why is that?

Detroit is lobbying very hard for government assistance. Claiming severe hardship, the Big Three automakers -- Ford (NYSE: F), General Motors (NYSE: GM) and Chrysler -- are requesting loans that will prevent a complete collapse of the industry.

The past few days have been full of debate on the matter. With so many issues and questions regarding the merits of a bailout, answers will be difficult if not impossible to come by.

"Throw something up against the wall and hope it sticks" seems to be the modus operandi of the current administration with respect to the financial sector bailout. Now, Detroit is essentially asking for the same thing.

Critics are rightfully upset. There is no guarantee that loans to Detroit will ever be paid back. What results will accrue for taxpayer effort? Is this simply a black hole? Which industry will be asking for help next?

These are all legitimate questions.

The case for the bailout is simple: No money from Washington results in bankruptcy with a chance of complete failure. With that failure comes the loss of three million jobs up and down the auto food chain.

And there is the rub. This is more than just the Big Three automakers -- they and their suppliers are all at risk of complete and total collapse.

One such supplier is Lear Corp. (NYSE: LEA).

It looks like the automobile industry is being led like a turkey to the slaughter as we approach Thanksgiving. While companies like General Motors Corp. (NYSE: GM) have been working overtime to produce a fleet of statistics to bolster their case for a Washington bailout, it's clear that President Bush and the Republicans are eager to wield a sharpened ax on its ever-more vulnerable neck.

The pre-bailout buildup follows the same narrative structure as the one for the Iraq war and the $810 billion bank bailout bill. With the Iraq War, the specter of a mushroom cloud was dropped on our unsuspecting heads. With Paulson's plan for a reverse auction to buy toxic waste, it was the threat of heavenly retribution. And now, the auto industry is promising 2.5 million lost jobs and $200 billion in government costs -- up from $125 billion last week -- if Washington does not bail it out.

The political forces lining up against the automobile industry appear more powerful than those who want to bail it out. While congressional Democrats want to divert $25 billion from Paulson's plan to bail out the auto industry, Bush and the Republicans oppose the idea. And until January, they appear to have the upper hand.