The Good, Bad, And the Ugly: Who Benefitted the Most From Cash For Clunkers?

This program has been a wake-up call in so many ways...

Coincidentally, 41% of the new vehicles achieve WORSE gas mileage than the average CLUNKER traded in. 41% of the new vehicles sold were trucks.

Remind me again, why were we giving tax payer money to people buying trucks?

I wondered that too

Emissions got lowered perhaps? Was there not more than 1 reason the president got this program on a roll? This is not a political statement but we must keep in mind that this program was endorsed by all parties.

Emissions: So if if 41% receive worse gas mileage is there a chance that this new vehicle can produce less emissions than the previous clunkers? Also keep in mind that for the remaining 59% of new vehicles purchased or leased, not only will their emissions be greatly improved but the gas mileage improvement will be tremendously better than the "slight" gas mileage worsening of new cars with worse gas mileage. Case in point... Look at the Top 10 cars sold and then compare them to the Top 10 cars traded in!! This can also be called an investment in our environment. [Keep reading, I wont get much sappier than that last statement.]

Dealerships: Wow, so foreign cars take the lead huh?? Does that mean that dealerships are mostly owned and employed by Japanese and Koreans?? Perhaps this influx helped local economies, kept another American family out of bankruptcy and allowed them to keep their roof over their heads? [Ok... a little sappy.] Dealerships and sponsoring of local community efforts you say? Thats right, many large and even small dealerships around the country help out their local communities and food banks. Perhaps with an increase in sales they can give more?

Assembly Plants: Oh no, I've really done it now... How many of these Foreign cars were built in the US?? Anybody care to take a stab at this one? Agent 001?? Just because you live in Big City USA doesnt mean that folks in Kentucky, Tennessee among other states don't enjoy this tiny boom. In fact, just about any company affiliated with the auto industry got to enjoy the ride. Even companies like LoJack out of Massachusetts loved the CARS program.

So to wrap this up... Do we want to keep focusing on the small picture?? Really? Isnt this what you might have accused Democrats of doing during the 8 years of Bush? Is this the time to be petty? How about we put political bias aside and enjoy the fact that during this program we made a difference where we live and helped stimulate the economy. Think about this from the White Houses perspective, the return on Investment in this case was HUGE!! Thanks to your, my and everybody else's Tax Dollars.

Since I can't boost my own statement... This message is just that... A BOOST not only for the economy and the environment but for me too. I traded in my 1997 Explorer with 213,000 miles for a 2009 Jetta SportWagen that is a PZEV (Partial Zero Emission Vehicle)!!!

"How about we put political bias aside and enjoy the fact that during this program we made a difference where we live and helped stimulate the economy. "

- Never going to happen. Some folks here no matter what, will not accept Obama no matter what he does. They are just bitter sore losers. LOL!! Also selfish.

Sour Grapes anyone? LOL!!

it helped out Ford and GM!!!

And to follow up with Shredmo’s observation – did we (the taxpayers) just encourage more people to over-extend themselves financially? How many of these buyers really needed to upgrade their vehicles vs. how many made an impulse purchase?

Hopefully people didn't put themselves in a pinch financially. But are we really aiming at just the negatives of this program? No, we the taxpayers did not encourage people to over-extend themselves... Silly people do that all by themselves. So now, is this a shame on us if it does happen? Come on now. Paranoid speculation like this is what fuels the media (Bad Media).

Airliner, did you pay a tax on your rebate (or have it deducted)? It seems that this rebate is taxable income (http://www.keloland.com/NewsDetail6162.cfm?Id=0,89084).

Why is Detroit responding so slow still, even to things like this?

Unless inaccurate data was given, it looks like there has been a big turnaround during the last week of the program. Originally, I was told that American manufacturers were on top and that majority of the money didn't go to California. lol

YOU BELIEVED IT! LOL!

001

American Manufacturers are not on top because (for the most part) American cars are crap. Folks weren't choosing American cars before. Why should they all-of-a-sudden be interested in American cars now?

If Obama said that the clash for clunkers program is only for american makes then you would have a post here by 009 stating that the Obama policy isn't fair towards foreign makes.

Obama just can't win as far as some people here are concerened (009). Because no matter what he does, folks here are going to say it's wrong.

There has to be at least one thing that Obama has done for the good of the country? Too bad some folks here (009) would never acknowledge it. hmmmm.

Like I said before. Learn how to accept democracy. You (009) and the country as a whole would be better off.

What the bleeding heart hand-wringing liberals forgot was who the consumer of the clunkers are. The urban poor, who can barely afford a weekly cash payment to the corner used car lot now have fewer cars to choose from and the prices just went up about 20% because supply has been cut. They can't afford the payment on a new car so turning a clunker in does them no good. Great job Obama - you screwed one of your most loyal voting blocks.

Your post makes no sense. Used car lots aren't the only place where the "urban poor" can purhcase a used vehicle. In fact most "Urban Poor" people Purchase their cars from private parties (after saving up) and pay cash because they have bad or no credit. You seem to know little about the "Urban Poor".

I got you. Seems like the poor are always getting shafted. Can you imagine the interest rates?

Looking at the net impact of the program, this is probably one of the better uses of stimulus money I have experienced. It will likely help get the auto industry producing again, help improve the environment, and won't cost the taxpayer anywhere nearly as much as advertised.

If you think about what it is going to take to get the auto industry moving again - we have to get credit flowing, then we have to get a massive inventory reduced and then we can start building cars again.

From a credit perspective, this proved that there was enough credit out there and people can get credit if they want to buy a new car.

From an inventory perspective - this wiped out a significant portion of the inventory overhang. The car companies will have to begin producing cars again to replenish supply. Indeed, some have already announced such production ramp ups.

From an environmental perspective, one had to trade in their clunker for a car that provided at least 2 to 4 miles per gallon improvement in mileage. Assuming people traded in clunkers that gave 18 MPG when new and only got a 2 MPG improvement, it is still an 11% improvement in fuel efficiency. Since the clunkers are probably not achieving the same MPG figures as they did when new, the average increase is probably better than 11% and probably more in the range of 15% to 20%. The emissions are significantly lower on newer cars as well, so we'll all breathe a little better as well.

With respect to cost - this program is an incentive. The taxpayer is not carrying the whole cost of people purchasing cars. If you assume that the average purchaser received a $4.2k in incentive and the average transaction value is about $20k, then almost $1.2k (assuming 6% sales tax rate) is generated immediately in tax revenues at the state / local level through sales tax. Assuming the salesman made a commission and the dealership and car company earned some revenue, there will likely be some offset from an income tax level as well. Hence, the net cost to taxpayers is less than the $3 Billion that is often advertised as the cost of the program.

One could argue that the Cash for Clunkers program just pulled forward demand and all of these benefits would have been realized in the future without taxpayer assistance. Perhaps this is the case - we'll never know if these clunkers would have been traded on used cars, new cars or kept on the road for an extended period of time. The idea behind a stimulus is to get money and goods moving now to jump start the economy rather than waiting out an especially vicious business cycle.

it should have been done in january!!!! That way the plants would not have been shut down in May and June. It would have helped dealers get through slowest time of the year. Our dealership did 190+ in clunkers hopre we get paid!!!!

By the way we had a ton of cash customers on this program. These are people that only bought a car because of the gov't money. Civic and Fits were the most common purchase.

These numbers are seriously flawed. How is it that GM placed second in overall new vehicle purchases and not a single one of their vehicles are in the top ten sales list? I think the other top ten list is more accurate.

Looks like Chrysler is to blame not GM and Ford. Chrysler was a no-show.