Dealer poll calls Cash for Clunkers a 'Nightmare,' four out of 10 didn't want program extended
Conventional wisdom says that Cash for Clunkers provided a big-time boost to dealers. After all, before Clunkers, most showroom floors were bereft of customers, and scores of dealerships were closing their doors. As good as C4C has been for customers, many dealers are all too happy it's over.
A recent (admittedly unscientific) survey conducted by Automotive News shows that 44% of the 800 dealers polled wouldn't want C4C to be extended again, even if the program was modified. Only 3% felt that the program should have been extended without being modified. The biggest issue dealers have with C4C is, unsurprisingly, its lack of timely payment. Some multi-store dealers have millions invested in the program, while little or no money has come in yet. An alarming 23% of dealers say they have had to borrow money to cover the cash crunch left in the wake of the Clunkers program, while an additional 10% say the program has actually sucked enough cash from the coffers that it has put the dealership at risk.
The Transportation Department and the Obama Administration have stated that every eligible C4C transaction will result in payment, but the federal guarantee isn't boosting many dealers' confidence. AN says that 43% of dealers surveyed aren't very confident that they'll receive all of their C4C dollars, while an additional 18% are not at all confident that they'll be paid in full.
Some dealers say that C4C has also hurt their repair, finance, used car and parts businesses, but that's okay if they collect from the feds. Even with the considerable downside of C4C, 74% of dealers say that if they're paid in full by the federal government, the program will positively affect their bottom line, while 5% say they somehow managed to lose money.
Cash for Clunkers officially ended last night at 8 pm.
[Source: Automotive News - Sub. Req. | Image Source: Ethan Miller/Getty]
Reader Comments (Page 1 of 5)
Matt 3:34PM (8/25/2009)
More proof this program was a terrible idea with terrible execution.
Only the very blind will call it anything close to a success...
Reply
Taglane 3:37PM (8/25/2009)
It was only a success for consumers who took part in the program. Everyone else? eh... not so much.
Matt 3:40PM (8/25/2009)
Not really...
People shouldn't be spending money they don't have for no reason. The vehicles traded in under this scam worked. Therefore, it would have been a lot cheaper to keep that car running than to buy a new one.
$6K in repairs < $25K new car.
Cody 3:51PM (8/25/2009)
My fiance' and I got a 2009 Kia Rio through this program for $10,000 out the door. After the Sticker Price without C4C and Incentives it would have been $17,000 out the door. Funny, we can afford the car just fine. Traded in an old Chevy G10 van that every part outside of the engine block was stripped and sold/used.
Of course, you are "that" Matt, so wtf do you know anyways?
Matt 3:57PM (8/25/2009)
Cody:
Thanks for giving our tax dollars to Korea...that should help the US Economy just fine.
akboss302 4:01PM (8/25/2009)
I think what Matt's saying makes a lot of sense, and this program was not well thought out. For most people, it would be better (on many levels) just to keep their car going than buy a new one. No debt, no worries. My wife drives a 1996 Camry that runs great, it has 188K Kms on the clock and runs just fine. Even if we had to put $4K into the car over the next year to keep it running tip-top, it has lots of life left in it. Its either pay a small amount right away and be done with it, or jump into payments for the next 2-6 years.
That being said, if her car got 15 mpg I might rethink my strategy...
futurama 4:05PM (8/25/2009)
@Matt
Wow... what about the salesman? people who work at dealership? people who will be providing service to the 'Korean' Rio'? Driver who delivered the car to the dealership? The guy who work at dock?... etc etc.. they all must be Korean and sending all the money they earn right back to Korea?
I really hope you do not own a single foreign product in your possession. Otherwise.. we will all be terribly disappointed.
Matt 4:09PM (8/25/2009)
"I really hope you do not own a single foreign product in your possession. Otherwise.. we will all be terribly disappointed."
Different.
I did not ask for a hand out or use any tax dollars to buy the electronics in my house.
A United States stimulus should stay in the United States...not go to Japan or Korea.
futurama 4:09PM (8/25/2009)
@akboss302
well.. obviously in your case, keeping 96 Camry makes perfect sense as it probably does not quality as a 'clunker' any ways.
For a lot of other people, however, this was a great program. They got rid of their old, fuel guzzling cars for a new, smaller, fuel efficient cars at a GREAT price.
Matt 4:13PM (8/25/2009)
"For a lot of other people, however, this was a great program. They got rid of their old, fuel guzzling cars for a new, smaller, fuel efficient cars at a GREAT price."
WITH MY TAX DOLLARS!
Paul 4:28PM (8/25/2009)
That's 100% bullsh*t.
Car dealers that always want their money yesterday are hardly a measure of the program's success and are notoriously partisan. The true measure is (1) jobs via sales: Car salesmen, production line, truck drivers, dockworkers, parts and service, etc. And (2) getting major polluters off the road, which this did in spades.
By any TRUE economic measure (not a self-reported survey of guys counting their treasure from afar), the program worked against the goals laid out and put food on the table for a LOT of people.
Redline 4:35PM (8/25/2009)
Matt, it's not YOUR money, it is the GOVERNMENT'S money. You paid it to them in the form of TAX. Get over yourself. Your argument doesn't make any sense.
notYou 11:26PM (8/25/2009)
I can't wait to see q4 sales tank since we just slid 40-75% of it's sales up into q3.
You heard it here first.
Rocketboy 4:48PM (8/25/2009)
Wow Redline. Last time I checked, the gov't existed at the public's behest, not the other way around.
You really scare me.
Luis 4:57PM (8/25/2009)
Yeah, Matt...it's not YOUR money, it's OUR money. If you don't want to pay taxes then leave the country, please. The foundation of this country's economy allows you to make money. The protections, etc.
WE vote and elect people to make decisions for us, and one of those decisions is C4C. WE do live with a government of the people, by the people and for the people. It's not "the" government, as the government is US.
Kelah 5:12PM (8/25/2009)
Luis scares me too.
Actually you can not leave the country and not pay taxes. The US Govt requires you to pay taxes for 10 years after leaving the country even if you renouce citizenship. Only other country that requires this is Libya.
Those govt officials also take an oath to uphold the constitution. Technically there is little in the constitution that allows them effect the economy.
What you are suggesting is little more than strong arm stealing but you don't have the guts to do it yourself. You require the govt and its guns to do your dirty work.
daleam 5:14PM (8/25/2009)
It isn't proof, it's evidence.
And yes, that's my money and I don't appreciate the government throwing it around all willy nilly.
Egon 5:24PM (8/25/2009)
"A United States stimulus should stay in the United States...not go to Japan or Korea."
Damn right, Matt. All those stupid consumers should have purchased a Ford Fusio...no...a Chevy Camar...no...a Chrysler 30...crap...Hey, how about a nice Honda Accord instead?
max 5:25PM (8/25/2009)
"WITH MY TAX DOLLARS!"
Thanks for your tax dollars Matt. Next time lets cut out the middleman, I'll come over and you can just open your wallet.
Sean 6:43PM (8/25/2009)
Hey Matt, if you're really that pissed off, an not just an incredibly juvenile troll, STOP PAYING YOUR TAXES.
If you really believe what you are saying, stop paying them. If you don't, you're just trying to make a stink and couldn't care less about what is done with your tax dollars.