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Cash for Clunkers - Good or Bad Idea?

4291 messages,  Last post on Jan 05, 2013 at 9:30 AM

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What is this discussion about? Legislation, Truck, Sedan, Wagon, SUV

Messages Page 428 of 430

#4262 of 4291 C4C didn't work by steve_ HOST

Oct 29, 2010 (11:14 am)

"In fact, it had the opposite effect than what was intended."
 
Surprise!!! Cash for Clunkers Didn't Work, Say Economists (minyanville.com)
 
I suspect it wouldn't be too hard to find some economists who would say it was a smashing success.

#4263 of 4291 Re: C4C didn't work [steve_] by ateixeira

Oct 29, 2010 (11:24 am)

Replying to: steve_ (Oct 29, 2010 11:14 am)
Here's our controversial statement, now give us $5 and you can read about it.
 
Dunno, sounds like a teaser to make $$$.

#4264 of 4291 Re: C4C didn't work [steve_] by stephen987

Oct 29, 2010 (12:15 pm)

Replying to: steve_ (Oct 29, 2010 11:14 am)
Thanks to C4C, I bought about two to three years sooner than I otherwise would have. But it meant taking on a second car payment--and therefore I didn't feel like I could spend as much.
 
If I had waited those extra two to three years, not only would I have bought a bigger and more expensive car, but it would probably have been a Ford or Chevy or Buick rather than a Japan-built Honda Fit.
 
I doubt this was the intended outcome.

#4265 of 4291 Re: C4C didn't work [stephen987] by berri

Oct 29, 2010 (5:57 pm)

Replying to: stephen987 (Oct 29, 2010 12:15 pm)
C4C was a bone for car dealers. Unfortunately for buyers, the used car market pricing is still hosed up from it. But now the government has moved on to building up more Amtrak routes so they can run more empty trains, consume more fuel and tie the government into ongoing wasted expenses into the future. Spend a bunch on more train cars and new track today and then keep spending on operating the money losing routes down the road.

#4266 of 4291 Re: C4C didn't work [berri] by fushigi

Oct 30, 2010 (4:41 am)

Replying to: berri (Oct 29, 2010 5:57 pm)
I don't think a significant portion of the used car market's higher prices is due to C4C. I think it's more likely due to the reduced new car sales. Here's my reasoning: When new cars are bought, some percent of the time they're bought as a replacement vehicle which means that the new car purchase also produces a used car to sell (dealer trade, private party sale, or some other transfer of ownership). I'm going to toss out a number and say 70% of new car sales create a used car. If the number isn't 70%, it's probably not too far off one way or another.
 
When the new car buy rate was 16 million a year, 70% of 16MM or 11.2MM used cars enter the market. But when new car sales fell to under 11MM units due to the bad economy, the used car supply was correspondingly reduced to under 7.7MM units.
 
C4C took around 700K cars off the market so less than 10% of a single year's supply. And it was a 1-time hit. The tanking of used car supply due to ongoing poor new car sales is a far, far larger contributor.
 
This is just my opinion, but to me it makes more sense than C4C having such far reaching effects.

#4267 of 4291 Re: C4C didn't work [fushigi] by hpmctorque

Oct 30, 2010 (9:58 am)

Replying to: fushigi (Oct 30, 2010 4:41 am)
I think you're correct. although I have no hard evidence to support this notion. The C4C program probably had an uneven effect across market segments, taking a disproportionate number of older SUVs and expensive-to-repair luxury cars off the road than, say, mass market compacts.

#4268 of 4291 C4C - Glad I passed by greatlakesjr

Nov 07, 2010 (5:28 am)

I was tempted by the C4C program but the dealers were not budging at all during those months. I would have had to trade in our old mini-van and to get a midsize sedan we needed then turn around and replace the mini-van as well. Turns out I got the sedan we wanted $5,000 off MSRP (dealers wanted FULL MSRP during C4C) and we still have the old mini-van still running fine. Glad I didn't bite. Can't say for sure what is jacking up used car prices but just looking for a junker for friends, we hear used car salesman talking about C4C as one of the reasons. Obviously that is just their version and may be a smokescreen anyway.

#4269 of 4291 Re: C4C - Glad I passed [greatlakesjr] by joegiant

Nov 07, 2010 (6:11 am)

Replying to: greatlakesjr (Nov 07, 2010 5:28 am)
Not if you would have been there at the very beginning...BEFORE the dealers knew what was about to hit 'em! There was a small window there for those who acted right away. Glad that it all worked out for you regardless of the CFC hoopla but don't kid yourself, some of us made a killing ($50 old beater trades that overnight turned into $4500 in addition to the rebates and deals that were going on at the time for select models/manufacturers on new cars).

Messages Page 428 of 430

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