Cash for Clunkers: Trucks outperform hybrids
Silverado outsells PriusBoy, what's up with the government's cash for clunker data? For weeks, according to the government, the Toyota Prius was one of the top selling vehicles via the Cash for Clunker program. In fact, I believe it was 4th for at least a couple of weeks.
Yet, according to the latest data, the Prius was the 14th best selling vehicle, falling below 2 large pick up trucks, the Chevy Silverado and the Ford F150.
I guess hybrid cars weren't quite as hot as we were led to believe. Nonetheless, many buyers did at least choose smaller, more fuel efficient vehicles.
Labels: fuel efficiency, Hybrid Vehicles, toyota prius
posted by Dahcredyns at
9:42 AM
20 Comments:
Saw a story this morning that claimed that Cash for Clunkers even helped sell Hummers.
In the effort to sell a few hybrids, the government destroyed 700,000 running cars, many in good shape. This has raised the price of used cars and cost auto repair shops, parts stores, car donation charities, taxpayers and low income people much money.
C4C definitely gave more than it took.
Yes there was an impact of removing700,000 running cars, but.....
1. There was a bigger impact from selling 700,000 new cars.
2. This helped the auto dealerships have record sales months.
3. It helped auto manufacturers, who recalled previously laid off workers.
4. It also helped the banking industry who issued out 700,000 new loans.
5. It helped consumers get into a new car at a lower price.
6. In addition it was a small step in the right direction in regards to reducing greenhouse gas emissions and foreign oil consumption.
Remember "A journey of 1000 miles begins with a single step"
All this impact for a mere $3 billion. If the other programs were as effective, our problems would be solved right now.
for the most part, people do not understand the stimulus of which the clunker program was really just another variant.
When the private equity market freezes up.. bad stuff happens.
the last time this happened, we had a depression.
The basic strategy to get out of it is for the govt to step in and spend money that the private sector is no longer spending.
it's not free.. it's borrowed against the future.
every new car sold for a clunker is a new car that will not be sold in the future...
but what was the alternative?
We'll never be able to prove that the stimulus/clunker program avoided a depression and there will always be a certain number of folks who say that the stimulus/clunker program was not needed....
but it sure look like to me that a lot of jobs would have gone away if the govt had not stepped in...
here's an observation that may get some push-back.
are the folks who advocate Hybrids - true free market folks?
or are they folks who believe the govt should involve itself in the market?
I'm ducking now....
larry-
the government is already heavily involved, is it not?
Anyway, here is another story I read about a study that claimed this program would have been more efficient if the focus hadn't been driven by the age of vehicles, but purely by fuel economy.
For the record, overall, i believe cash for clunkers was a worthy a program, despite my earlier reservations. However, I do believe it could have been more efficient, and I do also have issues with just how off the data provided by the government was regarding real world results of this program early on. Initially, the government painted a far more rosy picture about how great the fuel economy increases were.
yes... but all of that was window dressing to make it look like a good cause...
at the root of it was an effort to get people back out to buy cars...
they're doing the same thing with homes...with an incentive for first time buyers..
the whole thing is an effort to get the economy jump-started since the financial markets froze up after they all bought toxic assets...
I don't think for the clunkers it was really ever about true efficiency.. they just did that as a pretext...
no?
I think you're mostly right and that's what bothers me a little.
It seems obvious the auto industry, especially after investing more than $80 billion into it, needed a kick start, and it worked.
The environmental impact was grossly inefficient versus the amount of money to achieve it however.
Michigan has an unemployment rate of 15% even with the cash for clunkers...
There are some who worry that we may not be out of the woods here yet...
and with regard to energy efficiency and hybrids - a bad economy won't help them.
yeah. i've been to michigan a number of times and have met some awesome people working in the auto industry there. i truly do feel for their situation.
of course, i think we're 12+ percent unemployed here in california, so my sympathy is a bit tempered.
nonetheless, that's why i've grown to accept the positive impact of the c4c clunker program, in terms of economics. we really had no choice, and i'd bet other programs are inevitable.
still, here in california, the titans of innovation don't believe that companies like GM and chrysler have learned much from their bankruptcy.
will we be here again in another decade? at some point we might have to get serious about that question.
there has been a lot of talk about banks being too big too fail.
has gm, for instance, become too big too fail?
no.. GM should go away if they don't make it this go around.
I'm giving them the benefit of the doubt during this crisis but if they can't make it later on - let them go..
this country cannot be in the auto business.
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"I don't think for the clunkers it was really ever about true efficiency.. they just did that as a pretext..."
I think initially, C4C was written in order to improve efficency.
But...
By the time the Senate was finished negotiating, the bill was so watered down that almost any new car or truck qualified for the rebate.
Now if we had a C4C program that only included hybrids, or vehicles that got above 40 MPG, that would be something.
That is what the European C4C programs are doing....
at the end of the day - they just wanted to get some cars out of the factories...
and we learned a lot. so, hopefully, such programs can be written better in the future.
of course, as smurf alludes to, will politicians want to write them better?
politicians writing subsidies and incentives is an unsatisfying activity for anyone hoping that only their favorite cause will benefit.
Normally what happens, is a whole bunch of special interests make the case for their favorite causes also.
I'm pretty skeptical about subsidies and incentives because you essentially have a bunch of congressmen who are influenced by special interests deciding which approach is best.. and that often ends up corrupt and wrong but worse than that - it actually stifles competitive innovation....
who knows where we'd be right now with ethanol if we had not favored corn from existing fields rather than other vegetation from unused, abandoned fields.
that way, it would have spurred new industries and additional employment...
Indigo Incarnates
It cracks me up that my taxes got used so that people who make much more money than me were able to buy brand-new vehicles when *I* cannot afford a new car. It's just reverse-socialism where the wealthy get their perks off the backs of the working class.
that's an interesting point, indigo.
there were, however, people that couldn't afford new vehicles that used this program to buy a new car. early data suggested that defaults on cars bought via this program will be at least twice that of conventional sales.
unfortunately, the government is between a rock and a hard place when it comes to the auto industry, so there are going to be mistakes and poor legislation thrown at the auto industry for a number of years into the future.
larry-
just wanted to say that overall i agree with your take on subsidies, etc., but they will always have a place in spurring change.
i guess i'd just like to focus more of our subsidies, etc. on consumers rather than companies. make companies compete for these subsidies via consumers.
Car donation charities didn't say the government should not have done Cash for Clunkers. What we did say, is that the cars turned in for a voucher should not have bee destroyed. We asked that they be given to charity instead. Those c4c cars in poor shape would be scrapped. However, those in good shape would be rapaired if needed and either sold or given to needy families. This would have eliminated many of the negative consequences of Cash for Clunkers.
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