NEW YORK (CNNMoney.com) -- What are people trading their clunkers in for? It depends on who you ask. The government's results showed small cars as the top choice for shoppers looking for Cash for Clunker deals. But an independent analysis by Edmunds.com disputed those results, and showed that two full-size trucks and a small crossover SUV were actually among the top-ten buys.
The discrepancy is a result of the methods used. Edmunds.com uses traditional sales measurements, tallying sales by make and model. The government uses a more arcane measurement method that subdivides models according to engine and transmission types, counting them as separate models.
Sales of truck models would tend to be heavily diluted using the government's method because practically each version counts as a different vehicle. The difference in tallying methods would not affect the overall totals of trucks, as opposed to cars purchased under the program, only the sales rankings of individual models.
Sales of GM's Silverado truck, under the government's counting method, were divided among five different versions. So were the Ford F-150s. If the different versions of these trucks were considered the same vehicle, as auto sales are normally reported, sales of these trucks would look much heftier.
MP: The Ford F-150 (pictured above) gets only about 14 mpg. and the Chevy Silverado gets the same 14 mpg.
MP: The Ford F-150 (pictured above) gets only about 14 mpg. and the Chevy Silverado gets the same 14 mpg.
I'm relieved, actually. I thought everyone was going to go out and buy Kia Rios.
ReplyDeleteThis is amazing to me. I thought the whole thing was to get low emission vehicles off the road? Or are the government just running up the deficit for the hell of it here?
ReplyDelete"Trucks are the most popular..."...
ReplyDeleteHmmm, again according to CNN Money we have the following: Top Ten Clunker Buys
Trucks as in pick-ups or as in box trucks?
I didn't see any 'trucks' on the list...
Edmunds: Ford Escape SUV -- not Focus or Corolla -- best-selling 'cash for clunkers' vehicle
"I didn't see any 'trucks' on the list..."
ReplyDeleteAccording to CNN:
http://money.cnn.com/2009/08/07/autos/cash_for_clunkers_sales/index.htm
The Ford F-150 is 5 on the list and the Chevy Silverado is 7. Those are trucks.
The SUVs do even better with the Ford Escape at 1 and the Jeep Patriot at 3.
Yet another externality of cash for clunkers.
ReplyDeleteIt could only be politician's logic that we reward people who bought gas guzzlers with government subsidies and imagine that consumer behavior has fundamentally been changed. Those who actually have purchased fuel efficient vehicles get zip.
"The Ford F-150 is 5 on the list and the Chevy Silverado is 7. Those are trucks."...
ReplyDeleteDid you actually look at the list?
The CNN article is dated Aug. 5 and there's NO pick-ups on it...
Hmmm, make me wonder if CNN is as usual sending mixed messages?
Note this sentence from the article I've linked: "It's crazy, but we're seeing trucks -- full-size pick-up trucks -- traded in for compact cars," said Mike Jackson, chief executive of AutoNation, the country's largest auto dealer chain, in interview late last week...
I'm confused...:-(
1, it's not confusing. The August 5th CNN list uses the flawed government stats. The August 7th list includes the 2WD and 4WD versions.
ReplyDeleteThe primary reason for this was always to prop up auto manufacturers. 'Green' reasons were just a way to sell it to those that dislike giveaways...
This reminds me of Bill Clinton claiming to have reduce the White House staff by 10% when he simply reclassified one dept. so it wasn't included in the total.
ReplyDeleteWelcome to the world of "nuance" or is the term now "callibration".
"The primary reason for this was always to prop up auto manufacturers. 'Green' reasons were just a way to sell it to those that dislike giveaways"...
ReplyDeleteO.K., good explanation... Now it makes sense and thanks for that...
"Welcome to the world of "nuance" or is the term now 'callibration'"...
QT! QT! QT! You're such a cynic...:-)
'calibration'...Ha! ha! ha!
Love that!
Another good explantion...
I apologize. My URL got clipped in my post. Here is the list dated Aug. 7, published by CNN:
ReplyDeleteCash for Trucks and SUVs
"The primary reason for this was always to prop up auto manufacturers. 'Green' reasons were just a way to sell it to those that dislike giveaways"...
ReplyDeleteThis sounds good, but I'm at a loss as to why the government is subsidizing foreign-manufactured cars, too. Even foreign brand cars made in America aren't made with unionized labor...
Have I missed something or is this program really contradicting itself in 4 different ways?
Austin,
ReplyDeleteThis program does not materially stimulate the auto sector or make even the most minor dent in a U.S. auto fleet of 250 million cars (ie. it's an environmental non-starter).
The exercise is purely political. Cash for clunkers is for the "little people". Joe Plumber is getting his turn at the trough.
Pardon me for retching.
1,
Yep, I'm cynical. I have looked at this from all angles and the economics make no sense whatever.
It's about politics.
The U.S. would be vulnerable to sanctions from the WTO if Congress limited the Green for Guzzlers program to domestic autos.
ReplyDeleteWe've seen this before (repeatedly actually) in recent history when Congress passed the Security and Accountability For Every Port Act of 2006, which banned Internet gambling. The problem with this act (other than the Orwellian name) is it provided exemptions for several derivations of domestic Internet gambling.
The 'little people' argument holds no water either, considering this program subsidizes luxury cars (cadillac, mercedes), even luxury cars that aren't 'green' in any way.
ReplyDeleteCan we even say this is shrewd politically? I really don't see how anybody can back this thing up without being laughed at.
Do you think this will have any substantial effect on the prices of used cars? after all, aren't all the trade-ins supposed to be demolished?
Can we even say this is shrewd politically? I really don't see how anybody can back this thing up without being laughed at.
ReplyDeleteYet another symbol of how completely out of touch the ruling class is from the "real" world of their constituency.
Austin,
ReplyDeleteI agree that this doesn't really help poor folks. The payola seems to be directed at the middle class who can easily afford a new car. Hell the average household these days has more cars than people.
The program is very popular with consumers judging by the extension of the progam. By this measure, Cash for Clunkers would appear to be a political success in an otherwise lacklustre first 6 months of Obama's presidency.
WRT the market for used cars and parts, doesn't supply and demand effect prices? When you reduce supply by destroying used vehicles without even salvaging parts, doesn't that shift the supply curve.
I understand that you do not believe this is about politics. Fair enough. I have argued in several prior posts that the effects of the program do not materially benefit either the auto sector, the economy or the environment. Quite simply, the # of cars sold is insignificant creating a temporary blip. This is no more effective than stimulus checks sent to consumers under GWB.
Perhaps, you could explain why you believe this policy is effective at more than creating debt and future tax obligations.
QT says: "Yep, I'm cynical. I have looked at this from all angles and the economics make no sense whatever.
ReplyDeleteIt's about politics"...
Your cynicism is more than understandable...
What's that old saying? 'follow the money'?
UAW lauds quick action on “cash for clunkers” funds
'Congress voted Thursday to add $2 billion to the program, which has delivered better than expected environmental benefits, since consumers are trading up to higher mileage vehicles with several UAW-made models among the top vehicles purchased'...ROFLMAO!
The UAW International Executive Board has unanimously voted to endorse Sen. Barack Obama for president, the union announced today.
"After a historic primary campaign which activated and mobilized millions of voters, our union is proud to endorse Sen. Barack Obama," said UAW President Ron Gettelfinger. "He has inspired our country with a positive vision for a better America -- and with concrete plans to turn that vision into reality.
"From the streets of Chicago to the state legislature in Springfield, Ill., to the halls of the U.S. Senate, Barack Obama has been a voice for dignity and justice for working people. He has a strong program for a safe and secure America, which will protect our citizens and help our country prosper in a new century.
...
Gee! I wonder how that's worked out for UAW members so far?...LOL!
1,
ReplyDeleteThe UAW is certainly getting its money's worth these days.
Yes QT, the UAW is certainly getting their money's worth...
ReplyDeleteIt also proves that it takes money to make money...
UAW is making money at the expense of someone else's property rights...