Just as the "cash for clunkers" program sparked a boom in auto sales, its cancellation will likely depress the industry, CNNMoney reports. As of today, the last day of the government-funded incentive, rebate applications for 625,000 trade-ins totaling $2.58 billion had been submitted. “We're definitely going to have a hangover,” a dealer says. “I think you're going to be able to shoot a cannon through here and not hurt anybody.”
Absent the monetary incentive to buy new, customers may simply stay away. And the frenzy of purchasing under the program has left dealer stocks depleted, which means the remaining vehicles are selling at inflated prices. “We're going to see a decline of about 40% in the immediate aftermath,” an expert says, but the lesson got through, says an industry insider: Americans know “it's OK to buy a car now."