Everyone who lives in the continental United States heard of the Cash for Clunkers program and what the government hoped it would do for the struggling economy. The up to $4500 trade in value for a “clunker” was definitely enough to get a lot of people’s attention. There were some stipulations on what you could buy after trading in your clunker – the car had to be a new, more fuel efficient vehicle. The program was such a hit in the beginning that the government ran out of funds and had to extend the deadline.
All in all, this program was a great way for a lot of people to get rid of old, environmentally damaging vehicles and get in to a new, reliable car. In order to qualify for a trade in, the vehicle could not be more than 25 years old, must be drivable and insured for at least a year and get 18mpg or less. Of course, there were bound to be certain vehicles that topped the list of most traded in cars during Cash for Clunkers. Consumer Reports put together a top ten list of the most traded in vehicles and the top ten purchased vehicles:
Now, the obvious objective of this government program was to help the struggling automotive industry – the American automakers in particular. What is interesting about these lists that Consumer Reports compiled is the status of the American car companies. Every car in the top ten traded in vehicles is from an American car company and eight out of ten in the top ten purchased vehicles are from Asian manufacturers. It’s good news that Ford nabbed the other two spots in the top ten, but it makes you wonder if this program achieved what the government hoped it would.
The main goal of the Cash for Clunkers program was to boost auto sales and feed money back into the American economy. With a majority of the new cars purchased hailing from Asian markets, how much good did this program do? Now, the program did get over 600,000 gas guzzlers off the nation’s highways which is a definite positive. The program also however, put a lot more foreign cars on the roads rather than American. It was still an economy booster for the auto industry and dealers across the nation with auto sales rising 10.6 according to government statistics.
While many of the new cars purchased under the Cash for Clunkers program were foreign, this did still help the American industry. Many of the foreign companies like Honda have stated they will be increasing production of their cars in the United States. While they may not be American produced vehicles, an increase in production creates a lot of revenue for states and opens up a lot of jobs at a time it is needed most. When it comes down to it, the Cash for Clunkers program seems to have been a huge success drawing a lot of customers to once empty car lots. There was a lot of revenue created for dealers, even outside of the government program and increased sales in a struggling industry, even if only for a short time.
Author Resource:
Scott Conklin is the president of Conklin Cars, a leading provider of Kansas Honda, Kansas Nissan, and other makes and models with locations in Hutchinson, Salina, and Newton. Conklin Cars can be found online at: http://www.ConklinCars.com .
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