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Cash for Clunkers Vastly Underrated: Researchers

Trade in program generated roughly 542,000 sales

By Kevin Spak,  Newser Staff

Posted Mar 10, 2010 12:28 PM CST

(Newser) – Cash for Clunkers was far more effective than anyone is giving it credit for, says a new study from Maritz Automotive Research Group. In their survey, 90% of program participants say they wouldn’t have purchased a new car without the government incentive—a far higher percentage than previous estimates. The group also notes that, while sales dipped immediately after the program ended, they remained higher than they had been before it.

The findings "debunk the myth that Cash for Clunkers mortgaged future car and truck sales,” Maritz’s vice president tells the Kansas City Star. “In fact, the program resulted in sales of vehicles to people who don’t normally buy them.” Many Cash for Clunker participants were people who habitually bought used cars instead. But Edmunds.com’s chief executive criticized the study. Sales data suggests that the program merely replaced the summer sales that dealerships hold anyway.

A  Cash for Clunkers sign hangs on a upside down automobile Friday, Aug. 21, 2009, in at a dealership in Detroit.
A Cash for Clunkers sign hangs on a upside down automobile Friday, Aug. 21, 2009, in at a dealership in Detroit.   (AP Photo/Paul Sancya)
In this Aug. 6, 2009 photo, a crane lifts a flattened car to a shredder at Gershow Recycling Corp. in Medford, N.Y.
In this Aug. 6, 2009 photo, a crane lifts a flattened car to a shredder at Gershow Recycling Corp. in Medford, N.Y.   (AP Photo/Mark Lennihan, File)
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COMMENTS
Showing 3 of 17 comments
bewilderbeast
Mar 12, 2010 9:37 AM CST
Please note, though, that this is FREE ENTERPRISE we're talking about. That system that's SO much better than fair enterprise. It rewards risk-taking and allows the cream to rise to the top, remember? (EXCEPT when it bombs. THEN it runs to government for handouts funded by taxpayers - which is socialism, that bad word you're not allowed to use). What we've had lately has been GREED Capitalism: All the profit and little of the risk, thanks to the unholy alliance between big corporations and their embedded lawmakers. Stand up for REAL financial law reform.
dax
Mar 10, 2010 11:57 PM CST
Well, it looks like the propagandists on the Right will need to come up with replacement bugaboo for their argument against national healthcare.
jsteven
Mar 10, 2010 11:23 PM CST
Just as any sane person would imagine--the right wing naysayers were wrong (and loud about it)--anyone would know that it would take this long to figure out the effectiveness of a program.

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