Video: Cash for Clunkers Hangover Coming as Sales Expected to Plummet

Car Dealer Review ^ | 8/23/2009 | CDR

[wrrock]

* Dealer: Sales increase have been great, ‘like someone turning on a faucet’ * Edmunds.com CEO: Clunkers hangover coming as future sales expected to plumet * Dealer: Great intentions, but not prepared for paperwork * Despite gains in fuel economy, program a small blip (fraction of 1%) of overall gains for the country

Watch video: http://www.cardealerreviews.org/?p=116702

[Caipirabob]

Should be interesting to see what price cuts take place following the 4.5K bump in pricing due to free munee from uncle sugar.

Sadly, those will be accompanied by job cuts. Prayers for those innocents crushed by farcical Obamanomics.

[Rome2000]

I fail to see what the entire point of this ridiculous 4 week long fiasco was.

Certainly it wasn’t to boost car sales long term, a short term increase followed by depressed sales doesn’t do a damned thing for anybody, except put a couple of hundred thousand morons into overpriced cars that will probably be repossessed in 50% of the cases.

The socialists in DC are going to pay for this in 2010

[Ghost of Philip Marlowe]

Politicians frequently display their complete ignorance of all issues economic. But perhaps they do so most convincingly when they suggest “tax-free months.” The idiot senator from WA state (Patty Murray, the brainless “tennis-shoe mom”), suggested one for WA. What this points out clearly to anyone paying even minimal attention is this:

1. They acknowledge that taxes slow down the economy.
2. They acknowledge that reducing taxes picks up the economy.
3. They acknowledge that they don't really need the tax revenue.
4. They acknowledge that their tax policies are fairly arbitrary.
5. THEY FAIL TO SEE THAT BY ANNOUNCING A TAX HOLIDAY FOR A PARTICULAR MONTH, THAT SALES WILL PLUMMET THE MONTHS BEFORE AND THE MONTHS AFTER THE TAX HOLIDAY, thus creating nothing more than a very temporary spike.
6. But guess what, the economy and tax revenues will decline even further AFTER the tax holiday because people will buy more than they ordinarily would because they are getting items cheaper. Thus, when the tax holiday is over and the consumers are even further debt-strapped, they will contract their spending AFTER THE TAXES COME BACK FROM THEIR HOLIDAY.

Cash for Clunkers elucidates the ignorance of these economically illiterate politicians for most of the same reasons.

Of course, we know that this deal was mainly a cash handout to the UAW, to spike the numbers to continue the LIE that the economy is recovering, and to enable the socialists in charge to use the sales as evidence of how well the government runs once-private enterprise.

[kempo]

I’m hanging on to my clunker. It’s paid for and you can buy a lot of gas with the money you would spend on a car payment.

[Tuscaloosa Goldfinch]

Amen to that. I have 220 K miles or so on mine but they are mostly highway miles. Hopefully it will last another 40 K or so, and then I’ll buy used, VERY used.

[lacrew]

Gee, who didn’t see that coming? Three billion down the hole.

[Freedom56v2]

I think it was supposed to be some sort of payoff to various consituencies and a PR stunt. Sadly, prices did go up for eligible cars and prices may go up on cars that qualified as they are now in shorter supply.

Wouldn’t it have been more fair and effective to give every family a tax cut to spend as the family saw fit if the government had really wanted to stimulate the economy?

[wrench]

It isn’t just the car payment. You have to carry collision and comp insurance if you have a loan. And (in Ga., anyway) you get to pay a nice hefty ad velorem tax every year on the value of the car. My clunker is 15 bucks, average is about $200 on a newer small car.

My cost per mile is under that of these new econoboxes, and the repo man won’t be getting mine, it is paid for.

[kempo]

I had a used car salesman tell me “everyone drives a used car” and he’s right. Go buy a new car off the show room floor and then try to sell it the next day and see what a beating you would take.

[AD from SpringBay]

We looked but decided against getting a new car right now. I spent some time with the manager of the dealership and this very thing is something we talked about. He anticipates a drop-off in new car sales when the program ends. He said they were probably selling the cars for September and October in August.

[_Jim]

It isn’t just the car payment. You have to carry collision and comp insurance if you have a loan.

Or, if you pay cash even (for a new car).

It's kinda like dating; oh why oh why would I try that again ... until I forget what fun it is, but then I remember that comp (and collision) are required just for peace of mind even!

Then, there's parking that baby in a parking lot where EVERYBODY else parks ... yikes! Door dings! Peace of mind is an older car ...

[wrench]

Actually, I encourage folks to buy new cars and trade often. That way there are plenty of used cars for me to buy.....unless obama crushes them.

[lurked_for_a_decade]

I see another Community reinvestment act in the making; In my area there are a lot of people who obviously cannot afford the new cars they are purchasing, who have no intention of paying back or capability of paying pack their loans.; landlords in Maryland can take years to get ride of their tenants and thousands of dollars in the process. I wonder if the word has gotten out through ACRORN and friends to buy cars, take out sub prime loans and rent in “good” neighborhooads because Uncle Sam will bail you out!!!!!

[Misterioso]

Should have been a barf alert for Matt Lauer.