Remember the “Cash for Clunkers” program?
While the media, the government, and in the auto industry called it a rousing success, detractors believe the program only prompted people who were planning to buy a car in the future to buy one then (called “sales forward”).
However, a study done by the Maritz Automotive Research Group discovered that the program did not pull sales forward.
The study found that many more vehicles were sold as a direct result of the incentive than were previously believed. More importantly, it did not “mortgage” future car and truck sales as opponents to the program claimed.
The program actually resulted in sales to people who would not normally buy a vehicle.
Instead, the study concluded that the incentive resulted in over half a million new new car and truck sales. Soon after the program ended, incremental sales were between 125,000 and 346,000 vehicles.
Moreover, the National Highway Traffic Safety Administration said that “Cash for Clunkers” created or saved 60,000 jobs.
via Detroit News
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