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.

So you finally get to see some growth figures from the ISM and then the market sells off again. We have enjoyed a heck of a run-up and now trading desks are lightening up to boot as we get closer to the 3-day weekend. Today was such a poor result on the market internals that even all the defensive stocks were dropping. Even inverse-leverage ETF's were getting traction again. Bill Gross's bleak outlook probably only added insult to injury today.

Here are today's unofficial closing bell levels:

Dow 9,310.60 -185.68 (-1.96%)
S&P 500 998.04 -22.58 (-2.21%)
Nasdaq 1,968.89 -40.17 (-2.00%)

Top Analyst Upgrades
Top Analyst Downgrades
Top Trader Stocks

It should not come as any surprise, but Ford Motor Company (NYSE: F) announced today that August saw an industry wide increase in auto sales.

Of course, the increase in sales can be attributed to the highly popular "cash for clunkers" program that brought auto buyers out in huge numbers. The August increase is the first time auto sales have moved higher in over 2 years.

Auto sales continued to drop in June, but we are starting to see signs that sales may be beginning to stabilize a bit.

The auto industry is still in deep trouble. It is going to take a while before things get back to normal, but before things can even start to improve, they have to stop worsening, and that's what may be happening.

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.

There's a great post on the lean manufacturing blog Evolving Excellence about the auto industry and what it might really take to fix it. Bottom line -- Evolving Excellence says more dealer cuts needed so General Motors Corporation (NYS: GM) and Ford Motor Company (NYS: F) will have to take more inventory write downs and buyout more dealers. Even with these reduced dealer levels, the U.S. automakers still only sell roughly one-half as many cars per dealer as their Japanese counterparts.

We all know that the auto industry has been in crisis over the past year, and February was yet another tough month for auto sales, with hefty declines in sales for the major companies.

Analysts have been hoping that the auto industry is going to turn the corner during the second half of this year, but we are still waiting for any sign that things are getting back to normal as General Motors Corporation (NYSE: GM), Ford Motor Company (NYSE: F) and Toyota Motor company (NYSE: TM) all reported major drops in sales last month.

While rival automaker General Motors Corporation (NYSE: GM) was monopolizing headlines this morning with its quarterly earnings report, Ford Motor Co. (NYSE: F) quietly slashed its forecast for 2009 auto sales. However, unlike GM, Ford says it has "no substantial doubt" about its ability to continue as a going concern.

In a filing with the Securities and Exchange Commission (SEC), Ford predicted that total U.S. car and truck sales could tumble to 10.5 million in 2009. The new figure represents a drop of 1 million vehicles from Ford's previous estimate. On the plus side, the automaker thinks sales could arrive as high as 12.5 million vehicles if demand begins to recover in the second half of the year.

In yet another bit of news from the automotive industry, Honda Motor Company (NYSE: HMC) president Takeo Fukui announced today that he will be stepping down from his post in June after six years with the second-largest Japanese automaker.

Fukui is passing the torch to Takanobu Ito, who currently serves as chief of automobile operations. The 64-year-old Fukui said, about passing the job to his 55-year-old successor, "It is very important to have a generational change in management every few years." It will be a challenging post for Ito, who assumes the reins as Honda and the overall auto industry face falling sales. The company is expecting an earnings loss of nearly 90% this year to $860 million (but at least they are still hoping to turn a profit).

Putting it mildly, it has been a turbulent time in the auto industry. Toyota Motor Corp. (NYSE: TM) replaced its president in January. Mazda announced changes in management in November. And Nissan president has delegated some of his responsibilities of late. Meanwhile, on American soil ... well, we all know the saga the Big-Three is facing.

Beth Gaston Moon works for WeSeed.com, "The stock market for the rest of us." The above comments are not intended as trading or investment advice.

For employees of Japan's third largest automaker, Nissan Motor Co. (NASDAQ: NSANY), the news today was grim. Nissan announced it will be eliminating a hefty 8.5% of its workforce, or roughly 20,000 jobs.

The news comes at a time when all automakers are struggling to deal with the global recession that continues to keep car buyers off the showroom floors. Nissan said it expects to report its first annual loss in the past nine years.

For the company's most recent quarter, October through December, Nissan reported a $904 million quarterly loss.

Struggling auto maker Ford Motor (NYSE: F) announced its January sales figures today, and as you may have guessed, they weren't pretty.

During the month, the Dearborn, MI. auto maker says it sold 93,060 vehicles in the U.S. Compared with the 155,832 vehicles sold during January of 2008, we are talking about a massive 40% year over year decline. Definitely not the way the company would have liked to kick off the new year.

As everyone knows, the auto industry is on the skids. In December sales of cars and light trucks fell by 36% to 896,124 vehicles, with Chrysler down 53%, GM down 31% and Ford down 32%. Toyota, with sales also down, is suspending production in Japan for 11 days.

The auto industry is facing two major problems: The first is whether to produce SUVs or cars. George Pipas at Ford seems to believe that customers will tend toward buying more cars in the coming year. The second major problem facing the auto industry is how to get customers into the showrooms.

The usual promotions to the consumer are "cash back" offers. But Hyundai has come up with the most creative and unique promotional program yet. Hyundai will let customers return their cars for up to a year if they lose their jobs or can't make the payments.

You can bet that as times get tough manufacturers and retailers will come up with a variety of "far out" deals. Whether or not they will work is anyone's guess.

Would you buy a Hyundai?

Today we got another clear cut sign of just how tough things have gotten for the auto industry. Japanese automaker Toyota (NYSE: TM) stated it is going to shut down factories for 11 days in February and March.

The news comes on the heels of yesterday's announcement that the company had a dismal month of December, with sales dropping by 37% in America, worse than Ford (NYSE: F) and General Motors (NYSE: GM), which saw sales drop by 32%, and 31% respectively.

The lack of sales resulted in one big problem for the automaker -- excess inventories -- leaving the company with no choice but to shut down production to reduce output in the face of continued slowing auto sales. The shutdown is going to affect all 12 of its Japanese plants, and is in addition to an already announced three day shutdown in the same plants this month.

I realize it goes without saying, but times are tough for American auto makers, really tough in fact, and for Ford (NYSE: F), the company does not see things changing any time soon, and is predicting another disastrous month for December sales for the ailing auto industry.

The company announced today that it believes when final December sales figures are released, we are going to see a horrible month, with Ford estimating that industry-wide, December sales will probably be around 35% lower than the same period last year.

When you consider the estimated December numbers you can start to get a feel for just how bad 2008 has been. Consider this: in 2007, industry-wide sales of light vehicles in America totaled 16.2 million. In 2008, that number is expected to drop dramatically down to around 13.2 million light vehicles in reaction to lower consumer spending and tightened credit lending.

There is no question about the troubles that the American auto makers have been dealing with, and things are not looking too bright for their overseas competitors as well. Toyota (NYSE: TM) announced today that November was another tough month for the Japanese auto maker, as the company witnessed the largest monthly decline in sales for the past 8 years.

During the month, Toyota saw its global sales dip by a massive 21.8%, and highlights the bad news that the company shared with the market earlier this week that 2008 would mark the first time in the past 70 years that the company would be reporting an operating loss for the year.

Earlier this year, the Japanese auto makers had appeared to be somewhat insulated from the slowdown that American makers General Motors (NYSE: GM) and Ford (NYSE: F) were dealing with. The main reason why the Japanese makers were able to weather the storm a bit better was their strong reputation for producing better, more fuel efficient vehicles. While this perception kept the Japanese auto makers stronger for the first part of the year, the overall economic slowdown and credit crunch have been taking their toll recently on all auto makers, the Japanese included.