Possible clunker? YIKES!!!!
There’s nothing new about automakers offering rebates to lure in buyers. For decades the auto industry has set the manufacturer’s suggested list price higher than what they expect to be the selling price as part of a marketing psychology that consumers are more likely to buy something if they feel they are getting a deal or special consideration. In their mind they are lead to think they might have saved $5000 when they just committed to pay $35-$40 for a new set of wheels that they will be financing for the next five to six years.
That’s the way it used to be before the Federal Government got into the automotive business. It was just a shell game, a marketing ploy, manipulating the numbers while arriving at the selling cost the automakers intended to sell the cars for in the first place just like the whole concept of selling cars at, near, or below factory invoice. Those invoices do not reflect the true cost of the car to the dealers.
Congress just added TWO BILLION more dollars to continue the cash for clunkers program. This is no manipulation on paper of the selling price, this is YOUR tax dollar going to pay car buyers whose trades qualify as clunkers based on their fuel mileage compared to the cars they intend to buy. The clunker then must be rendered undrivable and not resalable destined for destruction even if they were perfectly drivable and safe cars before being used as bargaining capital in this latest government ploy.
Perhaps the government was hoping “Cash for Clunkers” would send buyers streaming into GM and Chrysler showrooms, and to be sure, they have seen a slight bump in their moribund sales, but the real winners are TA-DAH Toyota, Ford, and Honda. Is there not something ironically satisfying to see that the automakers who are making good cars to begin with who could do just fine without the government bailing them out should be winners in this bizarre sweepstakes?
The best seller is the Toyota Corolla followed by the Ford Focus, Honda Civic, Toyota Prius, and Toyota Camry though apparently General Motors is moving the most over all total number of cars. While four of the five top sellers are Japanese manufacturers, ironically the Japanese cars are primarily built within the United States but the Ford Fusion is built in Mexico. Go figure. One of GM’s best sellers, the Chevrolet Impala is built in Ontario, Canada.
Something just doesn’t seem right about destroying perfectly good cars for political bragging rights. While the rebates seem unseemly enough having the American public underwrite the car purchases of other citizens, getting rid of drivable cars that might be very beneficial for some seems like just one more manifestation of government waste.
If the government is going to be giving money away, surely there are some enterprises that deserve consideration. Here’s an interesting insight into the issue from Diane Auer Jones, former Assistant Secretary of Education for Post Secondary, current President and CEO of the Washington Campus writes her sharp critique of the program with a proposed alternative. Check this out!
http://chronicle.com/blogPost/How-About-Cash-for-Students-/7548/
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