Cash for Clunkers Program Ends
August 26, 2009 by Mark Ellis
Filed under Business
690,114 cars, $3 billion, and 30 days later, President Obama’s vaunted Cash for Clunkers program has come to an end, meaning that those who did not take advantage of the deal are out of luck. Analysts have praised the program for helping to save jobs and for generating hundreds of thousands of auto sales, but critics of the program wonder if Cash for Clunkers helped foreign automakers too disproportionately.
According to one analyst’s estimates, the Cash for Clunkers program ended up incentivizing the auto industry enough to save 39,000 jobs, allowing more dealers to keep workers around thanks to increased sales. For example, General Motors plans to reinstate 1,350 jobs and pay overtime for another 10,000 workers.
However, Asian automakers also experienced sales spikes thanks to the Cash for Clunkers program, with eight of the top ten cars purchased throughout the program coming from Hyundai, Honda, Nissan, and Toyota. Only the Ford Escape and Focus represented U.S.-made cars in the top ten list, causing critics of the program to wonder how much money went to stimulating foreign car companies in lieu of American companies.
Image: Flickr
It remains to be seen if cash for clunkers really did increase new car sales or just crammed them all into 5 weeks. Even if it did, it was at the expense of auto repair shops, auto parts stores, used car dealers, car donation charities, the taxpayers and the poor. The government just robbed Peter to pay Paul!