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It should not come as any surprise, but Ford Motor Company (NYSE: F) announced today that August saw an industry wide increase in auto sales.Of course, the increase in sales can be attributed to the highly popular "cash for clunkers" program that brought auto buyers out in huge numbers. The August increase is the first time auto sales have moved higher in over 2 years.
The program was initially allocated $1 billion, but quickly had to be adjusted to meet demands. Congress eventually lifted the allocation to $3 billion, and almost all of that was used up before the program came to an end this Monday. According to the Transportation Department, the program lead to nearly 700,000 sales at a cost to tax payers of $2.88 billion.
There are definitely valid arguments against the "cash for clunkers" program, but no one can argue against the fact that it definitely gave the auto makers a much needed boost in sales.
According to Ford's president of the America's, Mark Fields, this month Ford has already surpassed its sales from August of last year, and still has another weekend to add to those levels.
In other auto news, General Motors stated today that it expects to see auto sales rise by 2 million vehicles industry wide next year to 12.5 million vehicles. Up nicely from this year, but still below the 13.2 million vehicles sold in 2008.
What are your thoughts on the "cash for clunkers" program? Was it worth it considering the boost it gave auto makers, or just a temporary band-aid with too heavy a cost for tax payers?
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Reader Comments (Page 3 of 3)
8-29-2009 @ 12:26PM
DaddyOJr said...
Fuel dependence decreased. Incomes of sales professionals and sales managers of American companies increased. American dealerships were not forced to close. American Banks lent money again. American insurance agents created new auto policies. Scrap metal was created-which will be sold. American auto plants will need to make new cars to replentish inventories. American states earned sales tax revenues. Banks will earn interest, and now these banks will loan out more money as a result. American bridges and roads will be repaired with state tax dollars from sales taxes collected. If you did not get cash for your clunker-you will drive a newly paved road, cross a new bridge, or have a traffic light installed. Maybe even get a loan by your bank because of the payback of these auto loans-EVERYTHING IS CONNECTED HERE PEOPLE!
What's the real problem?
Imagine walking into a room with 900 BILLION dollars. This is what GEORGE BUSH spent on the Iraq war-on the credit card people. What have you or I received in return for this investment? NOTHING! You also lost many freedoms people-take a look at the Patriot Act-you lost more freedoms than you can imagine during Bush's presidency. Get a clue...some of you people!
8-29-2009 @ 12:29PM
jlw said...
If people can't pay their mortgages, and THAT situation isn't getting any better, are they going to be able to pay for the new car? Not to mention the pseudo inflated sales numbers. So....the banks are bailed, most of the auto industry chose the bail, what about the majority of 'joe citizens' still financially flailing? I'm talking those who are trying to pay their bills and want to work and living within their means until they have no means.
Govt's should learn to live within their means. Tort reform doesn't seem to be happening anytime soon and the same for the good ole American govt staple, pork. Gotta get past the 'we want' and concentrate on the 'we need'....and I'm not talking the 'need' to buy a vote.