The Japanese appear more willing to replace car companies CEOs as profits fall due to the troubled auto market. In the U.S., none of The Big Three has replaced its chief executive since the industry crisis began.

According to The Wall Street Journal, "Honda Motor Co (NYSE: HMC) said Monday that it appointed Takanobu Ito, a senior managing director, as new president and chief executive to replace Takeo Fukui." The departing CEO will get to stay on the board of directors. Just three weeks ago, Toyota (NYSE: TM) replaced its chief executive.

A great deal of the new technology that U.S. car companies are showing at the big auto show in Detroit is based on the U.S. car industry's plans to "go green." Some of those programs are based on electric cars. Others are based on ethanol hybrids.

According to Reuters, "the stars of the show were a slew of new or improved fuel-efficient and eco-friendly 'green' cars like the Toyota Prius and Chevrolet Volt."

Some analysts think The Big Three are too late to the table with "green" cars and that Japan has too big a lead. That may not be the problem at all.

Often cars powered with alternative fuels are more expensive than gas-driven cars. All that modern technology costs something. Consumers are looking at gas in the $1.70 range and oil prices moving toward $30 a barrel. Car buyers are often short-sighted. Why buy a hybrid when a gas car is inexpensive to operate? Oil prices may not go back up for two or three years. Maybe.

"Green" may not sell because the price of filling up an "old style" car has become remarkably cheap again.

Douglas A. McIntyre is an editor at 247wallst.com.

Two years ago, over 16 million light vehicles were sold in the U.S. Last year, the number was only 13 million. The sales rate for last month, based on the numbers reported yesterday, was below 10 million vehicles on an annualized basis.

So, what is the new normal for domestic car sales? It ain't 16 million.

With a deepening recession, what was once unimaginable is now imaginable. Car sales in the US may not recover for years. According to The New York Times, "The historic collapse of the new-car market dragged on in December, raising questions of whether the auto industry will ever again have sales levels that it took for granted just a few years ago."

A close look at those numbers is worthwhile particularly since the estimates that the Big Three gave Congress are based on an annual U.S. sales rate of over 12 million vehicles a year. The cuts in expense they are proposing are built around the assumption that they will be able to break-even at that level once their restructurings are behind them.

If a car or truck has an average price of $25,000, each million sales lost in a year takes $25 billion out of the market. If 2009 figures come in at 10 million, the market will be $50 billion short of Big Three estimates. In other words, their restructurings will not be nearly enough, and their need for federal money will be much, much greater than has been anticipated.

Put anther way, the present bailout plans don't even scratch the surface of the capital the industry needs.

Douglas A. McIntyre is an editor at 247wallst.com.

The proposals for a federal bailout of The Big Three get more madcap with every passing day. One of the latest plans would be for the U.S. government to own large pieces of the American car companies. What would it do with those equity positions? Sell them down the road? What if their value falls sharply because of foreign auto competition or a lengthy recession? Why not just put all of the assistance capital as debt senior to all other debt and equity?

According to The Wall Street Journal, "Under terms of the draft legislation, which continued to evolve Monday evening, the government would receive warrants for stock equivalent to at least 20% of the loans any company receives." Who needs warrants? Why not just charge a slightly higher interest rate on the money and get the yield out that way?

The idea is riddled with stupidity, but that has never stopped Congress from acting in the past. One of the major questions is how the government would eventually sell its interest in the firms without it being viewed as a vote of no confidence. The shares might be sold to a large financial firm that thinks Detroit's prospects have improved, but that is a long shot, especially based on where the industry sits today.

The plan seems like a risk of taxpayer money unless the government intends to send everyone in the U.S. one share in each car company. At least the average citizen would have something to hang on to.

Douglas A. McIntyre is an editor at 247wallst.com.

Congress cannot come up with many ideas about how to solve the car company crisis. It can provide the $34 billion that GM (NYSE:GM), Ford (NYSE:F), and Chrysler have requested. There is no guarantee that this is enough money. Car sales could continue to fall. The UAW and creditors may not give in enough on cost cuts to improve margins.

One idea pushed around the Senate hearing room yesterday was a merger of GM and Chrysler. The two companies have already had talks. What a great idea. The federal government can cut the auto firms it needs to save from three to two.

The only problem is that the idea does not work, at least based on one of the government's major goals, which is to save jobs. When GM and Chrysler were talking about a marriage three months ago, estimates for jobs losses from the merger ranged from 30,000 to 60,000. That is nearly as many people as would be put out of work if one of The Big Three went under.

There is no ready solution to sharply cutting costs at America's auto firms. Putting two of them together devastates the economy by putting more people on social service programs and killing the tax base in places such as Michigan.

Any other brilliant ideas in the suggestion box?

Douglas A. McIntyre is an editor at 247wallst.com.

Something has to give if Detroit is going to get Congress to loan it money. Some suppliers may have to take haircuts on their prices. Some debt-holders may have to convert their paper to equity or accept cents on a dollar for payouts.

But, the UAW may be the party that gets hammered the most. Labor costs are still the largest problem for The Big Three. It is not just daily wages. It is the tremendous health and pension benefits for current employees and retirees. It is the funding of the VEBAs created to move pension liabilities off the car company books into funds controlled by the UAW.

The Wall Street Journal reports "UAW officials, including its president Ron Gettelfinger, are said to understand that they are under pressure to deliver cost concessions." That may mean elimination of "job banks" which allow certain workers to be paid even when they are not working. Those are mostly people who can be recalled quickly if the car companies need to up production. The need for more people is unlikely to be necessary as sales keep falling.

The question becomes how often UAW management can go back to the rank-and-file and request they they take less. That is on top of the less they took less than two years ago when the union agreed to concessions to help keep The Big Three healthy. That certainly did not work out.

While the union's president may recommend that the cuts are necessary to keep Detroit open and keep some jobs intact, UAW workers may not feel that way. Their ultimate leverage is a strike. US auto companies can't to stay open for long if workers walk off the job. And, one thing the industry cannot handle is an inability to ship cars.

UAW members know they have power. Now, the question is whether they will use it.

Douglas A. McIntyre is an editor at 247wallst.com.

General Motors Corp. (NYSE:GM) is in talks to buy its longtime rival Chrysler from DaimlerChrysler AG (NYSE:DCX), according to Automotive News (registration required).

Discussions are going on between high-level executives at both companies that go beyond product development, the trade publication says, citing sources in both the U.S. and Germany. Shares of both companies are up, indicating that investors aren't too worried that the Big Three will become the Big Two.

If this happens, it would underscore the huge mistake Daimler made in buying Chrysler in the first place. The two companies never really seemed to mesh. Combining General Motors and Chrysler wouldn't be a picnic either and there is no guarantee that a stinger company will emerge.

I guess synergies can be achieved through combining manufacturing capacity and back office functions. But General Motors already has a lot on its place already and digesting Chrysler would be a huge undertaking. A combined General Motors and Chrysler would pressure Ford Motor Co. (NYSE:F) to find a merger partner as well or private equity buyers.

A wave of consolidation would lead to thousands more layoffs, further hurting the communities that have relied on the automotive industry for decades.

That's on top of the thousands more they are already facing.

How sad.