Cash for Clunkers has been a tremendous success so far, despite substantial setbacks. After only a week following its launch, the program was suspended as Congress decided to appropriate more funding to keep the program afloat. But with another $2 billion added to the program, some suggest that the “gold rush” mentality might be subsiding, leading to pre-Cash for Clunkers sales levels to return by next week.
Since its peak in July, auto research groups have suggested that interest in the program has fallen about 15 percent. The program spurred interest from car buyers at a Ontario Oregon Subaru dealers and elsewhere as it provided $3,500 to $4,500 vouchers for those that traded in an older gas guzzler for a fuel-efficient new car.
With new funding, demand has waned according to industry experts such as Edmunds.com. Analysts say the original funding budgeted for the program was too low in relation to the auto market overall and this created a “gold rush” mentality to take advantage of the cash before it was too late. With another $2 billion earmarked for Cash for Clunkers, some among Boise used cars dealers fear the urgency has been minimized.
Despite what many suggest is a decline in the Cash for Clunkers frenzy, one dealer that specializes in Birmingham used cars expects new car sales to be healthy as car buyers will be bargain hunting this summer prior to 2010 model year releases. Despite what slowing popularity the Cash for Clunkers program may have, auto sales will likely improve over the summer as consumers hunt for bargains before new models hit the showrooms this fall.
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The Cash for Clunkers program continues, but will the demand?
Tags: cars, cash for clunkers
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