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Cash 4 Clunkers. Was It Worth It?


shelbymotorsports

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Well now that the program is over lets see what we ended up with.

 

690,114 cars total cars sold using the C4C program.

 

Out of the 690,114 cars sold 421,000 of the sales were foreign cars.

 

Estimates range from 50-80% of the 690,114 cars sold were going to be sold anyway. The C4C program just motivated buyers to make a purchase now instead of a few months from now.

 

The 690,114 junked cars are obviously going to have an effect on scrap metal prices. Something that China and India are no doubt happy about right now.

 

A new car marketing firm did a survey of 1,000 C4C participants. 17% of them had buyers remorse compared to a "normal" buyers remorse of 6-8%.

 

So now that the program has ended lets start a list of what we have:

 

 

  • 3 Billion Dollars Of Debt
  • A spike in car sales that will be followed by a several month down turn of sales.
  • An for sure increase in bad debt & repossessions.
  • More car sales & profits to foreign car manufacturers.
  • Lowered scrap metal prices that foreign buyers will surely enjoy.

 

 

I'm sure more can be added to the list.

 

The question is was this program really good for the american people?

 

Steve

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People in Government, like Van Jones, are just the best there is, so you have nothing to worry about!!!!

 

I'm sure they would manage healthcare every bit as effectively and efficiently.

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But wait...there's more!

 

Now they've taken a huge number of viable used cars off of the streets that many people who still could not buy a new car could have afforded.

But that's OK, because there will be a huge influx of reposessed cars about six months from now when many of those C4C purchasers will realize...they stilll can't afford a new car. That should really quash new car sales.

The car insurance companies are surely finding a windfall with all of the C4C cars traded in that they were probably only getting about $50/month in payments on and are now seeing $200/month or more in higher car insurance payments being paid on...which will lead those who got those cars to realize...thay can't afford them!

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the whole concept was a sore spot to anyone that looked into the realities of it...a big 'green' mistake of a idea that our great great grandkids will be stuck paying for...

 

the initial post in this thread covered it pretty well- I'd add the unemployed folks looking for basic transportation got screwed too as most used cars were 'worth 4500' for a while...and most of the 'clunkers' I saw were better than what a lot of folks that couldnt afford a car (even at 4500 off) have to drive everyday- hoping the engine dont go as the boneyards lost half a million used engines...but I'm sure them folks are happy to see the taxes they pay also going to scrappping cars better than theirs.

this whole program was a freaking misttake-I'm afraid to see what happens when sept sales come out- thinkin stocks are gonna take a hit again, as probably 3/4 of the folks thinking about buying did already...

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Cash For Clunkers = A way for the Govt. to keep there two manufacturers afloat.

 

It would not have been fair to not include Ford.

I think it was a waste of taxpayers money, it will hurt the small used car business, and will increase the amount of repossessions.

 

 

 

Chris

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Cash For Clunkers = A way for the Govt. to keep there two manufacturers afloat.

 

It would not have been fair to not include Ford.

I think it was a waste of taxpayers money, it will hurt the small used car business, and will increase the amount of repossessions.

 

 

 

Chris

 

I don't think the C4C Program did much to help Chrysler or GM.

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It seems it might have helped Galpin. I flew over their storage lot today. Where they usually have new cars parked they had about 500 or more clunkers bumper to bumper and door handle to door handle. If I had a camera, I would have taken a picture. It was amazing. Maybe, if I remember, I'll get a picture next week.

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When I see the taxpayers paying $4500 for cars that are worth $1200, and then seeing the $4500 cars being crushed (i.e., the money thrown away), then multiply that times thousand of cars, and then see that people find themselves in worse debt after being lulled into the program, and then see that, in the end result, it doesn't really increase sales to dealers but instead just moved them up in time, and that most of the car sales profits went to Japan and Korea, and then see that the dealers aren't getting repaid by the government, I don't think it was worth it and once again the taxpayers are for the most part losers due to a democratic party inspired goverment program. This, after we gave the auto industry $81B that may never be repaid.

 

God help us if government-run healthcare is forced down our throats.

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Well now that the program is over lets see what we ended up with.

 

690,114 cars total cars sold using the C4C program.

 

Out of the 690,114 cars sold 421,000 of the sales were foreign cars.

 

Estimates range from 50-80% of the 690,114 cars sold were going to be sold anyway. The C4C program just motivated buyers to make a purchase now instead of a few months from now.

 

The 690,114 junked cars are obviously going to have an effect on scrap metal prices. Something that China and India are no doubt happy about right now.

 

A new car marketing firm did a survey of 1,000 C4C participants. 17% of them had buyers remorse compared to a "normal" buyers remorse of 6-8%.

 

So now that the program has ended lets start a list of what we have:

 

 

  • 3 Billion Dollars Of Debt

  • A spike in car sales that will be followed by a several month down turn of sales.

  • An for sure increase in bad debt & repossessions.

  • More car sales & profits to foreign car manufacturers.

  • Lowered scrap metal prices that foreign buyers will surely enjoy.

 

 

I'm sure more can be added to the list.

 

The question is was this program really good for the american people?

 

Steve

 

 

Steve,

 

When looking for facts to pan the program, and I'm sure there are others, you should first recognize that many of these "foreign cars" are built right here in the USA. Many of these foreign car manufacturers are partially owned by, or partnered with, US companies. Consider the Ford-Mazda joint venture known as AutoAlliance International that makes the Mustang and the Mazda 6 on the sam assembly line. In 2007 Toyota sold 2.6 million vehicles, 1.7 million of those were made in the US. By 2010 Toyota will have the capacity to build 2.2 million cars here after investing $21.8 billion, creating 43,858 direct jobs, and purchasing $29 billion in goods from American suppliers, including some 500 tier one suppliers in 25 states.

 

Then again regardless, the dock workers are American, the transportation companies are American, the dealerships are American, and the sales people that work there are American, the service people are American, the banks are American, the people that register the cars are American, the insurance companies are American, etc., etc., etc.

 

The American public with all the talk about GM and Chrysler were hesitant to go with either of those brands and people should be free to buy what ever car they want. Let's not forget that Buick is still around because of its sales to China where it is a leading brand.

 

Was the program a good idea? I don't know yet., but I do know it's far more complex a question than what you've listed here.

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Steve,

 

When looking for facts to pan the program, and I'm sure there are others, you should first recognize that many of these "foreign cars" are built right here in the USA. Many of these foreign car manufacturers are partially owned by, or partnered with, US companies. Consider the Ford-Mazda joint venture known as AutoAlliance International that makes the Mustang and the Mazda 6 on the sam assembly line. In 2007 Toyota sold 2.6 million vehicles, 1.7 million of those were made in the US. By 2010 Toyota will have the capacity to build 2.2 million cars here after investing $21.8 billion, creating 43,858 direct jobs, and purchasing $29 billion in goods from American suppliers, including some 500 tier one suppliers in 25 states.

 

Then again regardless, the dock workers are American, the transportation companies are American, the dealerships are American, and the sales people that work there are American, the service people are American, the banks are American, the people that register the cars are American, the insurance companies are American, etc., etc., etc.

 

The American public with all the talk about GM and Chrysler were hesitant to go with either of those brands and people should be free to buy what ever car they want. Let's not forget that Buick is still around because of its sales to China where it is a leading brand.

 

Was the program a good idea? I don't know yet., but I do know it's far more complex a question than what you've listed here.

 

 

Jeff

 

Let me first say I'm not against foreign cars. My daily driver is from Japan and I worked for many years for a German auto manufacturer.

 

While many "foreign" cars are built here in the states with many North American parts the profit still goes back to the home country. So the question I guess is how much of that 3 billion dollars left this country never to return?

 

Again no problem with anyone purchasing a foreign car but when our government gives away our tax money to do so is where I start going hmmmm.

 

Don't want to get too polictical as I stay as far away from that as I can but even with the foreign element removed it appears the C4C program was bad for the middle class tax payer.

 

Steve

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Jeff

 

Let me first say I'm not against foreign cars. My daily driver is from Japan and I worked for many years for a German auto manufacturer.

 

While many "foreign" cars are built here in the states with many North American parts the profit still goes back to the home country. So the question I guess is how much of that 3 billion dollars left this country never to return?

 

Again no problem with anyone purchasing a foreign car but when our government gives away our tax money to do so is where I start going hmmmm.

 

Don't want to get too polictical as I stay as far away from that as I can but even with the foreign element removed it appears the C4C program was bad for the middle class tax payer.

 

Steve

 

 

Ok, I understand. Yes, the profit goes to the parent in the end, but that part that's reinvested, as is the case with Toyota above, helps a lot of US companies as well. All I wanted to point out was that people shouldn't try to do simple math here and say XX% were foreign cars therefore XX% of the $XX Billion went overseas. The second thing I wanted to make sure was recognize was the surrounding eco-system around these cars, bank loans, insurance, car products (people wash and wax new cars not clunkers) etc., such that there are other benefits to the overall economy. Of course the oil companies may not be happy, but I suspect people will actually drive more, so even that might be a wash.

 

Hey, I was against the auto-bailout, and not too happy with this program, but I do understand (I think) the rational, and I'll wait till the dust clears and we look back on it and then access the real results. Seems to me, like a lot of these things, people are treating it as if it was supposed to be some instant magic bullet to our problems and that's not fair or realistic. Agree or disagree with it, as an American, I hope it ends up having its intended effect even if we had to make the investment.

 

Good discussion!

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  • 4 weeks later...
  • 4 weeks later...
Cash for Clunkers Results Finally In: Taxpayers Paid $24K per Vehicle Sold, Reports Edmunds.com

 

http://www.virtualpressoffice.com/publicsi...isableHistory=Y

 

Just what many predicted, all C4C did was to move sales from one quarter to another quarter.

 

Kind of like the boycott gas companies thing. Don't buy gas on Tuesday but then purchase twice the amount of gas on Wednesday.

 

Well I'm glad this administration thinks its ok to use my tax money to assist my neighbor in driving a brand new 2010 vehicle when I'm not driving a 2010 vehicle.

 

Steve

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Was the program a good idea? I don't know yet., but I do know it's far more complex a question than what you've listed here.

 

Brother Jeff,

 

For what it's worth, I consider every Shelby owner a brother of mine. We have far more in common, than what divides us. But this is not a complex question. When government forcibly takes money from one taxpayer, not to run the essential functions of government, but instead to give it to another taxpayer to encourage behavior that government desires, it is a perversion. A freedom destroying, disincentive to production. This is not a complex question at all. Either one comes down upon the side of freedom, or he, by default, sides with tyranny.

 

Chip

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I consider myself a progressive - a center left kind of guy. But I really don't think that this was a well thought out plan. What we're left with was certainly not worth implementing this thing, in my opinion. It was a giant waste and I hope they never do it again.

 

Ken

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Brother Jeff,

 

For what it's worth, I consider every Shelby owner a brother of mine. We have far more in common, than what divides us. But this is not a complex question. When government forcibly takes money from one taxpayer, not to run the essential functions of government, but instead to give it to another taxpayer to encourage behavior that government desires, it is a perversion. A freedom destroying, disincentive to production. This is not a complex question at all. Either one comes down upon the side of freedom, or he, by default, sides with tyranny.

 

Chip

 

 

I consider myself a progressive - a center left kind of guy. But I really don't think that this was a well thought out plan. What we're left with was certainly not worth implementing this thing, in my opinion. It was a giant waste and I hope they never do it again.

 

Ken

 

 

+1

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Brother Jeff,

 

For what it's worth, I consider every Shelby owner a brother of mine. We have far more in common, than what divides us. But this is not a complex question. When government forcibly takes money from one taxpayer, not to run the essential functions of government, but instead to give it to another taxpayer to encourage behavior that government desires, it is a perversion. A freedom destroying, disincentive to production. This is not a complex question at all. Either one comes down upon the side of freedom, or he, by default, sides with tyranny.

 

Chip

 

Chip, the question on the table is would it have cost the government and thus the taxpayers MORE had the all the automakers been allowed to go bankrupt and not get what is essentially a hand out. How many hundreds of thousands of autoworkers would have been placed on Unemployment? How many smaller firms would have gone under as well. How many area merchants that depend of these workers would have gone under adding even more strain on the system?

 

Don't get me wrong, I was against these bailouts and have said so here MANY MANY times, but I understand why others in positions of power with research up the wazoo might think differently and consider this a good long term investment offset with future corporate and individual income taxes.

 

Jeff

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