THE DETROIT NEWS – Last year’s “cash for clunkers” incentives program stoked demand for cars and trucks without pulling sales forward, according to a study by the Maritz Automotive Research Group.
“Our findings not only provide strong evidence that many more vehicles were sold as a direct result of the incentive program than were previously estimated, but they also largely debunk the myth that ‘cash for clunkers’ mortgaged future car and truck sales,” said Dave Fish,
vice president, Maritz Automotive Research Group. “In fact, the program resulted in sales of vehicles to people who don’t normally buy them.” Toledo, Ohio-based Maritz surveyed nearly 36,000 consumers who bought a new car or truck between July and August 2009, when the Car Allowance Rebate System was in effect. It concluded that the “cash for clunkers” program generated 542,000 incremental new car or truck sales, meaning that those buyers and lessees would not have been in the market without the lure of the incentive program.
Experts previously estimated that incremental sales generated by the program ranged between 125,000 and 346,000 vehicles. According to Maritz’ survey, half of all trade-ins were more than 10 years old and had more than 100,000 miles. It said older vehicles such as these only averaged 15.8 miles per gallon and were replaced with vehicles averaging 24.9 miles per gallon, citing data from the National Highway Traffic Safety Administration.
The Maritz study concluded that the program didn’t pull sales forward. Although sales dipped in September when the program ended, partly due to depleted dealer inventory, the annual selling rate from October to December was higher than in the months preceding the “cash for clunkers” program.
Previous studies have shown the “cash for clunkers” program created tens of thousands of jobs.
According to a NHTSA report, the program created or saved nearly 60,000 jobs. The Ann Arbor-based Center for Automotive Research has said 40,200 new jobs were created, including about 11,000 in Michigan and Ohio alone.
