Daily (Show) update on Cash For Clunkers, and a look into the future
The foggy blur surrounding the fate of Cash For Clunkers (aka C.A.R.S.) is clearing up. On the political front, passage in the Senate of the extra $2 billion in funds now looks incredibly likely. White House Press Secretary Robert Gibbs said that the $2 billion would be enough to keep C4C running through September. Perhaps Senate Majority Leader Harry Reid's threat to keep Senators from getting their August vacation had something to do with it. The Daily Show did a funny piece on C4C this week, and you can heck out the clip (possibly NSFW) after the jump.As for which vehicles are the most clunked and the most purchased, new top ten lists have appeared that show that Ford is winning both sides of this race. The most-traded in vehicle is the Ford Explorer. Six of the top ten guzzlers that are now biting the dust are Ford Explorers (MYs 1994-1999). The most popular new car to buy is the Ford Focus, with the Honda Civic, Toyota Corolla, Toyota Prius and Ford Escape rounding out the top five.
America has just started our Cash For Clunkers experience. But European countries have been working with similar schemes for a while now, and two new press releases hint at a possible future for the U.S. First, SaveMoneyOnCars is telling people who want to buy new cars but don't have a qualifying clunker to trade in that they should sell their car for parts and buy a nearly new (less than three years old) car. Second, Glass's is calling on "the Government to extend its Scrappage Scheme at least until next summer in order to avoid a very significant fall in new car sales and a consequent collapse in revenues for car manufacturers and retailers." Might a similar call rise up in the U.S. once the euphoria dies down? After all, if Mad Money Jim Cramer is a fan of C4C now, how long can it go on?
[Source: AP, Yahoo!, SaveMoneyOnCars.co.uk, Glass's]
Photo by dno1967. Licensed under Creative Commons license 2.0.
The Top Ten Cash for Clunkers Trade-Ins:
- 1998 Ford Explorer
- 1997 Ford Explorer
- 1996 Ford Explorer
- 1999 Ford Explorer
- Jeep Grand Cherokee
- Jeep Cherokee
- 1995 Ford Explorer
- 1994 Ford Explorer
- 1997 Ford Windstar
- 1999 Dodge Caravan
The Top Ten Cash for Clunkers New Cars:
- Ford Focus
- Honda Civic
- Toyota Corolla
- Toyota Prius
- Ford Escape
- Toyota Camry
- Dodge Caliber
- Hyundai Elantra
- Honda Fit
- Chevy Cobalt
PRESS RELEASE:
Nearly new cars offer best value for money over Scrappage Scheme
Don't have a car which qualifies for the Government's Scrappage Scheme? Don't fret, if you opt to part exchange your old vehicle and buy a nearly new *vehicle instead you can save loads more.While a nice £2,000 deduction from the RRP price of a car sounds good, new cars plummet in value as soon as they hit the tarmac losing on average half of the value of the vehicle within three years. Most dealers would expect to make generous discounts off the list price and research has already shown the scheme in some cases is not the best deal for consumers.
With the Scrappage Scheme money expected to run out long before the official close in March, many customers could find that they are back in the real world, buying cars without Government cash.
In fact it has been suggested that the funding for the scheme could run out as early as October, shortly after the new 59 plate comes out, a prime time for buying new cars.
Even with smaller cars, which are the most likely to make economic sense to buy under the scheme, it can still work out a better deal to sell your used car and buy a pre-registered or nearly new one instead, leading car deals website, SaveMoneyOnCars.co.uk advises. Taking an example, one of the most popular cars bought under the Scrappage Scheme is the Kia Picanto. This car is available for £4,495 under scheme. However if you opted to buy used a 2006 registration Kia Picanto with a measly 16,000 miles on the clock is available from £2,999!
Or take the Ford Fiesta, available to Scrappage customers for £8,595 for the basic model, but available on SaveMoneyOnCars.co.uk for just £7,999 for the top of the range Zetec, 2008 registration with 23,512 miles on the clock.
As a final example the Vauxhall Astra Life 1.4 I available for £8,495 under the Government Scheme. Alternatively you could opt for a 2007 registration Astra Energy 5dr with 34,000 miles on the clock for £6,999.
On top of this, factor in the trade-in value for your old car and savvy car buyers who forego the Government cash could be laughing all the way to the bank.
Marketing Manager, Richard Lawton says: "Consumers should research the market thoroughly rather than assume that the Scrappage Scheme offers the best route to buy their next car. They could find better deals by opting to buy a nearly new car instead.
"Using a website like SaveMoneyOnCars.co.uk allows car buyers to check thousands of cars from main dealers, brokers and car supermarkets in one fell swoop."
SCRAPPAGE SCHEME MUST BE EXTENDED TO AVOID "SUDDEN AND DAMAGING" FALL IN NEW CAR SALES
Glass's is calling on the Government to extend its Scrappage Scheme (*) at least until next summer in order to avoid a very significant fall in new car sales and a consequent collapse in revenues for car manufacturers and retailers.
With Scrappage Scheme registrations currently running at around 13,500 per week, it is estimated that the Government's allotted funding could run out as early as October 2009, well in advance of the very earliest forecasted rise in consumer confidence. The immediate outcome, says Glass's, would be to plunge new car orders to levels seen in the fourth quarter of 2008, with little prospect of an improvement until well into 2010.
Glass's points to several factors that will combine to further depress consumer demand after the current Scheme ceases. In particular, it highlights the return in January of the 17.5 per cent rate of VAT, coupled with growing public awareness of rises in new car list prices amounting to around 7 per cent on average so far this year – made necessary by the falling value of the pound against the euro. Consumers may well baulk at the higher prices, it suggests, delaying any recovery still further.
"The Government should urgently re-evaluate the planned discontinuation of the Scrappage Scheme in order to avoid a sudden, pronounced and damaging fall in business," comments Adrian Rushmore, Managing Editor at GlassGuide.co.uk. "Consumer confidence will continue to be at a low ebb at least until next summer, and without the contribution of Scrappage sales, the new car market will rapidly fall to the levels seen during the last recession, when around 1.6 million cars were sold each year."
Rushmore says the profitability of scrappage sales for dealers and manufacturers should not be underestimated. "Retail sales generated through the Scheme often provide a better margin of profit than sales to corporate fleets. Its absence would, therefore, be felt in two ways: a loss of sales, and a loss of the most profitable sales."
Glass's says dealers throughout the UK want the duration of the Scheme to be extended, and the definition of what constitutes a 10-year-old car to be broadened to cover those vehicles registered on or before 28 February 2000 (V-plate). The company says there is a strong case for the Scheme to apply to vehicles that have no MOT, provided they meet the age criteria. To maximise the benefit, many dealers are also calling for the VAT increase to be deferred until later in 2010.
"A continuation of the Scheme can be a win-win for all parties," adds Rushmore. "The Government's existing contribution of £300 million is being offset by the additional VAT revenues accrued, so extending the scheme need not hit the public purse. Meanwhile, the new car market would gain vital support until the beginning of a wider economic recovery, rather than being returned to the perilous position of late 2008.
"For dealers and manufacturers alike, it is an opportunity to move out of a loss-making situation, with the knowledge that virtually all the Scrappage business is being done with customers who would not otherwise have considered a new car purchase. Unlike other scrappage schemes operating across Europe, there is little or no prospect of our scheme 'pulling forward' new business, only to suffer an immediate decline when it is withdrawn, and the used car market will be similarly unaffected."
Reader Comments (Page 1 of 3)
Tim 3:21PM (8/05/2009)
You “Progressives” are a compassionate lot aren’t you?
Too bad you use your hearts instead of your heads… THINK!
This Cash for Clunkers program is an assault on the working poor who have no credit, and don't have the cash to afford a new car. This program will lead to FEWER used parts and FEWER cheap used cars available which is the ONLY way many of the "working poor" actually get to and from work…. more unemployment!
So, the Progressives just print up more money and run up the public debt which will cause inflation so that the things the poor NEED such as food, utilities, clothes etc. all cost more. Then the progressive increase the minimum wage so the poor can afford these higher prices but the small businesses instead lay off employees or don’t hire or expand because labor is too expensive.
Then the progressives just increase taxes on the small businesses in order to pay for more redistribution, welfare, unemployment and so on so small business contract some more and on and on it goes…
Not only is this program a socialist redistribution, it actually HURTS the poor. It does however help the unions, auto dealers, big auto, politicians and of course those banks making new car loans. (the rich just get richer)
Eco-Fascism at it's worst!
(Unintended consequences! Progressives are deaf, dumb, blind AND stupid!)
Reply
Anti-Tim 4:18PM (8/05/2009)
I've been amazed at the neo-fascist ability to be phony champions of the working class, but you take the cake. You are in no way interested in the working poor. You are the worst kind of right- wing neo-fascist douche (like there's a good kind). You expect the poor to drive vehicles that get the worst gas mileage, are in constant need of repair and are also the worst for the environment. This program is designed to address all of those issues, but you would miss that because you are not really thinking you're just regurgitating right-wing pablum.
If you actually had an origninal thought about it, you would realize that this program will put MORE and MORE affordable, reliable, and eco-friendly cars on the road. This will allow the working poor to have MORE and MORE money for the things they need. Also, the massive amount of unemployment we're now seeing has little or nothing to do with people being unable to drive to work, it has to do with a lack of jobs-- its the economy stupid. It was your neo-fascist 'ideals' under President Bush that has caused the world-wide economic collapse that we're ALL experiencing so shut your hole. Don't pretend to defend the poor in the name of your self serving "ideals" you're simply trying to justify your own gluttony in the name of the poor.
Tim 4:37PM (8/05/2009)
Anti-Tim
You really are clueless aren't you.
You don't understand what fascism is nor do you understand simple economics.
You should run for Congress. You'd fit right in.
Anti-Tim 5:43PM (8/05/2009)
I'm certainly not going to learn anything about economics (or grammar) from you. You live in the neo-fascist Libertarian fantasy land.
Maybe you should check yourself into a mental institution, you'd fit right in.
Matt 5:48PM (8/05/2009)
Woah, woah, woah... Bush "caused the world-wide economic collapse?" Please explain that one because i thought Clinton wanted everyone to have a home and made sure the mortgage rates were low. That encouraged investors to invest in real estate, causing a housing bubble, which eventually popped, putting builders out of work, causing material surpluses, plant shutdowns, high unemployment, and eventually market failure when it was combined with extremely high fuel prices. So, refresh my memory on which part Bush caused, Anti-Tim.
Tim, this doesn't mean I agree with you, but I do disagree with Anti-Tim.
Anti-Tim 6:09PM (8/05/2009)
Once again, flawed logic and revisionist history permeate rethuglican (thanks polo) comments. Low interests rates do not equal sub-prime mortgage lending. And investing in real estate does not cause a housing bubble. Greed and self-serving rethuglican bankers cooked that one up and were able to operate for years with the blessing of a rethuglican congress and president. I will modify my statement that Bush caused the meltdown, he was too stupid and inept to cause anything. He simply muddled his way through 8 years of presidency while greedy and corrupt corporate republicans had their way with my country. Now we have to dig our way out of it just like we did after Regan's legacy.
Tim 6:15PM (8/05/2009)
Anti-Tim said "... neo-fascist Libertarian fantasy land." ???????????? W.T.F.
I forgot about the low IQ of a typical progressive. I need to start using smaller words when talking to them.
polo 6:21PM (8/05/2009)
"This Cash for Clunkers program is an assault on the working poor who have no credit, and don't have the cash to afford a new car. This program will lead to FEWER used parts and FEWER cheap used cars available which is the ONLY way many of the "working poor" actually get to and from work…. more unemployment!"
A program that save "the working poor" $4,500 is an attack on them? You rethugs must be really scared that Obama's going into august recess with a popular success like this. Otherwise why are you even posting these idiotic rants?
Oh and maybe you could elaborate on how taking 250K cars off the road will have even a marginal impact on used parts available...when we have over 257MILLION cars on our roads...and the cars are being held at scrap yards to be parted for 180 days before being crushed?
Anti-Tim 7:54PM (8/05/2009)
Tim-
What part of neo-fascist Libertarian fantasy land did you not understand? Your IQ may be the one in question. Let me make it easy for you: You are a greedy self-severing individual. You think that copying a pasting from Libertarian websites makes you educated and well-informed. You think that claiming the working poor as your own makes you noble, and righteous. You think that if we could get rid of "big government" then the market would regulate itself. That is a delusional fantasy, you are mentally ill.
Matt,
I don't buy an explanation of the economic meltdown can come from the owner of a construction company in Vermont. You'd be better off looking at this, it is simple and easy to read, even Tim could understand it.
http://economics.about.com/od/grossdomesticproductgdp/ss/economymeltdown.htm
Anti-Tim 8:11AM (8/06/2009)
I don't care who you believe about the meltdown. You're damn right we're all in this because George Bush and his Rethuglican cronies taxed and spent Billions and Billions of OUR money on a war (and a multitude of greedy self-serving actvities).
You are not working poor. Your car is not a clunker. It was that idiot Tim who suggested that this program was somehow related to the working poor, it is not. That is the lie in this collection of posts. This program is designed to get clunkers off the road and to stimulate car sales (Bradley not to help out your poor buddy with his Volvo). I don't care whether it causes a auto sales bubble, that is NOTHING compared to the mess the Rethughlicans have caused (or failed to fix) over the last eight years including a 5 TRILLION dollar debt (not even a bailout), that not only you (Matt) and I will have to pay back but it will be our great-great grandchildren who shoulder that burden. Is that your idea of success? because of it is you and I really do have very different ideas about success.
Anti-Tim 10:31AM (8/06/2009)
(I was attempting to start a new thread to get away from said idiot, but I guess you couldn't follow O.P. foul +1, douche)
Again, you claim you know and present facts, and, again you are mistaken. The national debt went DOWN 8.2% over Clinton's last four years and went up %18.6 in Bush's 8 years!, let alone expanding government by enormous strides:
"We [Republicans] have now presided over the largest increase in the size of government since the Great Society," said Sen. John McCain
Speculate all you'd like about the future but don't blame Clinton and Greenspan for the Bush administrations' massive corruption and greed that has the current administration struggling to keep the world economy afloat.
I agree with your point about the poor not buying new cars, I believe this program should be expanded to incorporate used cars as long as they meet they the mileage requirements.
Tim 2:58PM (8/06/2009)
Anti-Tim aka Polo(ck) LOVES free speech… as long as it’s his own.
(typical pathetic Progressive-fascist who believes what’s yours is mine and if you disagree, want freedom or don’t need a “big brother”, you’re a “troll”)
To the retard Progressives… this is fair, this is good.
Matt 4:06PM (8/05/2009)
Democrat = Liberal = Large Portions = Spends a lot of money
Who is surprised by this? They're doing exactly what they said they would. If American's don't like it, we'll vote better next time.
Reply
Throwback 4:46PM (8/05/2009)
Haven't you heard, we will spend money on a stimulus, healthcare, cash for clunkers, cap and trade, cut taxes for the middle class AND reduce the deficit. The secret is to just keep spending money! P.S don't try this at home, the folks in Washington are trained professionals.
Matt 5:34PM (8/05/2009)
SWEET! I'm middle class!
...when do they cut my taxes again? I didn't get that memo yet.
Anti-Tim 5:37PM (8/05/2009)
Democrat = Liberal = Large Portions = Spends a lot of money
Republican= Conservative = Hypocrite = 8 Years of George Bush = Largest national debt in recorded history = worldwide economic meltdown. Who's to blame?
polo 5:49PM (8/05/2009)
"Democrat = Liberal = Large Portions = Spends a lot of money"
Bush + Republican control of Congress + 8 years = $5Trillion increase in National Debt
You rethuglicans can't stand that this program is a huge success. But keep acting like semi-retarded 4th graders, you'll be helping alot of Dems in next years elections.
Matt 5:52PM (8/05/2009)
I blame Clinton and Greenspan... see above.
polo 6:08PM (8/05/2009)
"I blame Clinton"
Of course you do, because we all know Clinton was President for the last 8 years, right? More BS rants from brainless partisans.
Matt 6:17PM (8/05/2009)
polo,
So, people taking "free" money is success? Who's money is that, anyway? It's yours and mine, or it was. I'll call it a success when the program runs out and the auto industry continues to keep sales up. I'll call it a success if it turns out that most of the cars sold are American made. I'll even call it a success if there is a measurable drop in pollution, but so far it's just a mad house of people grabbing big discounts. Republicans are your friends and neighbors, and we're not on a witch hunt; we just want Capitalism and Free Trade to work the way it was intended to. Maybe the crazies make it hard to see, but most of us just want fair treatment across the board: flat tax, don't kill babies, and don't reward laziness. This isn't some personal insult, it's just that we believe hard work should equate to success, no government interference necessary.
See here:
http://www.reedconstructiondata.com/jim-haughey/post/how-the-subprime-mortgage-mess-began/
then after you understand how the mortgage crisis happened….read this to learn how the mortgage crisis led to world recession
http://www.reedconstructiondata.com/jim-haughey/post/how-did-600-800-billion-of-us-mortgage-defaults-cause-a-worldwide-economic-/
…..not Bush…he just happened to be there when it came crashing down. Yes he accumulated debt, but that was a cost of war not your typical republican fundamentals.