Posted on 10/29/2009 8:50:50 AM PDT by MissesBush
Auto sales analysts at Edmunds.com say the pricey program resulted in relatively few additional car sales.
-- A total of 690,000 new vehicles were sold under the Cash for Clunkers program last summer, but only 125,000 of those were vehicles that would not have been sold anyway, according to an analysis released Wednesday by the automotive Web site Edmunds.com.
Still, auto sales contributed heavily to the economy's expansion in the third quarter, adding 1.7 percentage points to the nation's gross domestic product growth.
Is the economy really getting better? The Cash for Clunkers program gave car buyers rebates of up to $4,500 if they traded in less fuel-efficient vehicles for new vehicles that met certain fuel economy requirements. A total of $3 billion was allotted for those rebates.
The average rebate was $4,000. But the overwhelming majority of sales would have taken place anyway at some time in the last half of 2009, according to Edmunds.com. That means the government ended up spending about $24,000 each for those 125,000 additional vehicle sales.
"It is unfortunate that Edmunds.com has had nothing but negative things to say about a wildly successful program that sold nearly 250,000 cars in its first four days alone," said Bill Adams, spokesman for the Department of Transportation. "There can be no doubt that CARS drummed up more business for car dealers at a time when they needed help the most."
In order to determine whether these sales would have happened anyway, Edmunds.com analysts looked at sales of luxury cars and other vehicles not included under the Clunkers program.
Using traditional relationships between sales volumes of those vehicles and the types of vehicles sold under Cash for Clunkers, Edmunds.com projected what sales would normally have been during the Cash for Clunkers period and in the weeks after.
(Excerpt) Read more at money.cnn.com ...
I think it's hilarious someone from the administration has to get all testy because Edmunds doesn't march to their tune. These street punks are so thin-skinned to reasoned, analytic dissent to their incessant flow of b.s. it's laughable. And didn't the media say it was Bush who was intolerant of criticism? I've never seen anything like this crowd when it comes to prickliness, yet Obama is never called on it. I didn't see Bush and his people scrambling to answer every critique of their policies. And you notice the DoT has no other substantive refutation other than a bunch of propaganda blather?
"The whole purpose of the program was to provide some kind of catalyst to kick-start the economy," he said, "and by all accounts the extra production that was added this year was a boost to the economy."
Great douchebag. We have an artificial economy where we took out of the pocket of one group and put it into the pocket of another. That's their idea of how to move an economy forward? And what happens to the economy now that the 1 month artificial boost to consumption and GNP has ended? What about all the dealerships that have seen demand run dry after auto demand was compressed into one single month? At what point do we get back to having an economy that runs under its own steam? Once again this confirms, I will never buy from a domestic automaker.
Thank all you taxpayers for giving me $4500, for my daughter’s vehicle whose FMV wasn’t even $1500.
Sorry you had to do it at the point of a gun.....
Baraq needs to keep GM and Chrysler out of another Chap 11 until Nov 2012.
Expect more “programs” in the interim to accomplish this.
The least you could do is buy us lunch...
“the government ended up spending about $24,000 each for those 125,000 additional vehicle sales.”....
Pathetic waist of my money!....
this..and this alone should disqualify Congress from the public purse..
Never buy from a domestic automaker? PLEASE!! Ford Motor Co. did NOT take part in the great government handout/TAKEOVER of the auto industry. And its sales have increased as a result, for a great many folks will NOT buy from Hussein Motors, whether it be called Chrysler or GM. So please take a look at Ford for your next purchase. I’ve owned Lincolns since 1979 and have had zero problems. All they really are—big Fords.
Great program.
Lets take a look at the Secretary of Transportation:
http://en.wikipedia.org/wiki/Ray_LaHood
A Rino from Illinois!
“The least you could do is buy us lunch...”
####
LOL!
I wish I could.
I think as downtrodden taxpayers, you’re entitled to at least a triple steakburger from Steak n’ Shake, but I’ll have to settle for thinking fondly of y’all.
Adams strikes me as the kind of guy who, when told they lost $10 per sale, would say "don't worry, we'll make it up on volume." Yet another pol who should not be allowed to play with OPM.
Edmunds.com's estimate of the ultimate sales increase generally matches what industry experts had thought, said George Pipas, a sales analyst with Ford Motor Co (F, Fortune 500). But that misses the point, he said.
"The whole purpose of the program was to provide some kind of catalyst to kick-start the economy," he said, "and by all accounts the extra production that was added this year was a boost to the economy."
Ford was one of the biggest proponents of the Cash for Clunkers program and several Ford models were among the top sellers under the program.
That said, I can understand why Ford would want to be part of this govt. spending spree. Obviously it benefits their business. What Ford fails to see, and many others, is that it takes away from some other part of the economy later as it adds to the mountains of debt this country is piling up and someone, somewhere, sometime will have to pay it back which will stunt future economic growth. But based on your passionate defense of Ford products, I will add Ford back into my future buying considerations. Thanks Oldpuppy.
It's probably worse than that. The 'additional' vehicle sales in all likelihood came at the expense of new home, or other big ticket purchases.
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