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
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)
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(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. (Read more Cash for Clunkers stories.)

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