Let's hope Maryland dealers get 'cash' from clunkers
Let's hope Maryland new-car dealers are getting a decent amount of this cash-for-clunkers action. They need it. Not only have sales of all cars plunged in this state. The portion of new-car sales is down, too.
In 2000 four cars out of every 10 sold in the state was new. The ratio has been falling steadily since then, and this year it went through the floor, according to figures from the Motor Vehicle Administration. For the year to date through June, only 27 percent all sales were new cars. A few years ago Maryland dealers were selling 1,300 or 1,400 new cars a day in June. Last month they sold a little more than 800 a day -- a total of 24,509, the worst performance in at least a decade.
The first $1 billion of clunker cash quickly got used up. It looks like another $2 billion is on the way. If all $3 billion gets spent that'll mean about 670,000 new cars moved off the lot across the country. Maryland's share of that ought to be about 10,000 cars, based on our vehicle population. As the program intended, that could make a huge difference for dealers. And it'll improve the environment.
Comments
I totally disagree with the assertion that this program will improve the environment in any statistically significant way.
MPG standards in the U.S. are still incredibly low. I visited a dealer a week ago this past Friday, and we had a very wry, uncomfortable discussion about the fact that there were NEW cars sitting in his lot that would qualify as clunkers under the MPG standards of the Cash for Clunkers program. How would you like to explain that?
Also, I am not a typical American car-buying consumer in terms of what I prefer to drive. There is a dearth of wagon/hatchback options, particularly as carmakers change model design in order to boost sales. Witness the revamped Subaru Forester--now a small SUV. I don't want a minivan. I don't want a small SUV. VW's wagons are the closest to what I am looking for, and the diesel models get better gas mileage than hybrids I've looked at.
The program is designed to boost sales--and only temporarily, at that.
Posted by: Laura | August 3, 2009 10:10 AM
This program I think needs to be rethought. I drive two older trucks approx. 10 years old. One is small for in town running around, while the other is for farm work. Both are in perfect condition both physically and mechanically. They both are paid for. The thought of destroying these perfectly good trucks makes this policy just horrendous. We are encouraging those not encumbered with a car payment to now go out and buy a new car, no matter how cheap, and finance that car.
On top of that I would argue that there is only so much "extra" money floating around and this program may be using up what slack there is for only one industry. On top of that new cars once driven off the lot lose 20 percent of their value instantly. They are money losers.
On the other hand, replacing an old roof, old windows, doors, is a not only a sound energy decision by reducing monthly costs, but also can increase the value of the home. The Obama camp only dedicated 1500 to this program per home.
So I would contend that reducing energy consumption was not the intent at all, but instead subsidizing the auto industry was really the intent.
Like all the bail out programs thus far, we will live to regret this cash for clunker program as well.
Also I would wonder what number of clunkers per month across the US are traded anyway? So you would really need to factor in that typical amount and look at what sold above that number to know how many more cars were bought.
Posted by: Susan | August 3, 2009 3:49 PM
so if you have two or more clunkers at your house you cannot trade both of them for one car. The program is for one per
person.
Jhenry
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www.cashforclunkersfacts.info
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Posted by: jhenry | August 5, 2009 2:17 AM
The cash-for-clunkers program simply means that all taxpayers pay for the discount that a few taxpayers receive on the price of a new car. I disagree that all taxpayers should be stuck paying a windfall for a few.
Posted by: Michael S. Altus | August 22, 2009 12:59 PM