The Cash for Clunkers Program Ended at 8PM EDT on Monday August 24. According to government statistics, 680,114 Cash for Clunkers deals were made using $2.88 billion of the $3 billion authorized for the program.. The average clunker received a $4,235 rebate. Reimbursements are coming very slowly to dealerships and the government is putting more processors on staff to handle the backlog. Overall, a rare successful stimulus program.
On July 24, 2009 new car dealers in the United States began accepting trade-ins of older vehicles not worth much for new cars. Based on their fuel economy and the fuel economy of the new vehicle purchased, customers received a voucher for $3,500 or $4,500 to apply to the purchase of a new car or light truck.
Ultimately, the results of this program may be the sale of slightly over 700,000 new cars and light trucks with about 250,000 incremental to what would otherwise have been sold. But the impact goes deeper. There will have been substantial sales tax revenue from each sale going to states and cities that sorely need the income. Additional income taxes will be generated from the additional commissions and salaries dealership personnel otherwise would not have earned. The list goes on.
A brief synopsis of the impact of the Car Allowance Rebate System (CARS) is shown below the fold…