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there are opinions that other way too.
if the C4C program had happened a few months earlier, or i was able to put off some of the repairs on one of my vehicles i would have taken advantage of it.
like a lot of early buyers, i have money in the bank making 1 or 2%.
it could have made a lot of sense to take advantage of the C4C program.
overall, a lot more money is getting put back into circulation, which is a good thing.
If the D3 automakers were all going to be gone in "6 months tops", C4C isn't going to save them. C4C is going to have to end, sooner or later. What then? Are these historically unprofitable companies all the sudden going to become money makers? Most everyone who was thinking about buying soon, has already gone out and done the clunker thing. So when C4C ends, the sales will be twice as bad as before C4C. Then, I guess more bailout money will be needed? Where does it all end? How much is too much? Do we ALL have to go broke, to save the automakers? It's amazing how many of you only see the bright side of C4C.
When the economy returns to some normalcy GM and Chrysler are likely to be ungodly cash machines. Only Toyota may have a better structure than these two now. They're gonna make money by accident...huge gobs of money.
You do live in a dream world. We have 30 million people out of work and no chance to hire many back. A few fat cats taking advantage of a handout from the rest of the Tax payers is hardly going to kick start this economy or the two dead auto makers lying on life support from the Federal treasury.
Not true. Those who have trades that do not qualify as clunkers, are looking at vehicles that don't get at least 4 MPG better than their current, or don't have a trade for whatever reason are waiting on the sidelines. Once C4C ends, stock levels return to normal, and transaction prices drift down towards where they were pre-C4C, they will step in and buy.
I should know; I'm one of them.
Also I did not say that this would happen next week either. I said 'When the economy returns to some normalcy.' I understand that in your negativista view of life this will never happen, ever again. But the rest of us continue to try to make things better for everyone. The economy will improve as it does in every cycle.
How many people grew up sharing a room with a sibling?
Shared a room with my younger brother until I moved out and went away to college.
Did your parents ever paid for you to play sports?
No. I bought my own glove, bat, and ball as well.
Pay for child care?
No. That was Mom's job.
Cell phones for your kids?
Shoot, access to A phone was a luxury. There were two land line phones in our house - one on the kitchen wall which we all used, and one in my parents' bedroom that we were forbidden to use. My mother is so cheap, she doesn't want to pay the extra dollar for touch-tone dialing and settles for pulse. You still hear that "rttt-ttt-ttt-ttt" noise when you press the telephone's buttons. Very retro.
Internet service?
No such thing in the 1970s and early 1980s
TV for each room?
Brother and I got one in 1979 when my parents won a small green B&W Philco television in a contest at a Christmas party. I still have it. Before that, brother and I got into some intense fights over which Saturday morning cartoon we'd watch on the circa-1970 Zenith color TV in the living room.
exotic vacations
Heck, A vacation was a rare luxury - usually spent camping or going somewhere withing reasonable driving range and staying in a cut-rate motel. Heck, if we got to stay in a motel with a pool, it was an awesome treat.
Lawn Service
That was and still is my job.
I'm sure that is what they were saying in Rome also. The last depression we still had potential for creating jobs. This time too many of our jobs are already gone to other countries. We have an undocumented horde of aliens willing to work for enough to buy a loaf of bread, living in the canyons all around here. Our government feels compelled to pander to them as possible future votes. Our dollar is controlled by Communist China. C4C may be a boon to you and yours. That is such a narrow picture of what is going on in this country. I'm glad you are so optimistic. That does not change reality.
Remember the Great Depression lasted over 10 years. We have 8+ years to go.
Chrysler, GM and Ford all made a ton of money in the past. As recently as 12 or so years ago Chrysler was the most profitable car company period. That is why Mercedes wanted to take them over. Chrysler had huge cash reserves and was very, very profitable. There were also very, very profitable without making any gianormous SUVs. They biggest SUV they made was the first Gen Durango and that wasn't even a full sized SUV.
So to say they are historically unprofitable is completely false.
The fact is that all companies, industries countries and empires have had their peaks and declined. Nothing is forever. This country has been trying to maintain its peak over many decades now by pumping more and more borrowed money into stimulus, while at the same time increasing social programs to support more and more legal and illegal people in this society, while continuing policies that decimate the non-college educated middle-class.
So the trend has been bigger and bigger stimuluses, putting us further into debt, meaning there is less and less that the government can and will do in the future.
When the $800B stimulus and this C4C are over which really create no permanent jobs, or change in the fact that many, many entire industries are now in China and India, then what? This whole scenario is like a drunken-sailor trying to keep the party going and not wanting to have the hang-over that's coming. Well we're getting near a pretty empty wallet.
And I also don't disbelieve the NYTimes estimate of 30M unemployed or underemployed in this country. That's only 1 out of every 10, and I know that to be true of family and friends. My fiancee's 18-yer old son can't even find a retail or restaurant job.
C4C is not Armageddon, okay? Relax--LOL!
Any person or institution that tells you there are no bumps in the road, and that everything is everyone else's fault, is a false prophet IMO.
It must hurt living in a place where everything is bad, the sun never shines and there's no hope.
Actually, there's one parallel to the Great Depression that's a bit disturbing. IIRC, about two years after the Crash of '29, the financial markets had made back most of their losses, but that recovery was short-lived, and everything went to hell soon after that.
Well, financially, I've bounced back to roughly where I was two years ago. Hopefully this recession really has bottomed out, and we're on the road to recovery. But, you never know. The whole thing could end up being what I believe they call a "W" shaped recession, rather than a "U" or "V"
That last depression, according to most historians, was unnecessarily prolonged because NOTHING was done by the government in the first 4 years.
So this suggests that moving fast, even if there are a few missteps, is way better for a government to do, than sitting on its collective butts.
My mom canceled the long distance on her land line. :P
"Russian lawmakers plan to support domestic car makers with a trade-in program similar to the "cash for clunkers" schemes which have lifted auto sales in the Europe and the U.S.
The Trade and Industry Ministry hopes to sway prospective car buyers by offering them a 50,000 ruble ($1,529) rebate when they hand in old cars to be scrapped, a spokeswoman for the ministry said Wednesday."
Russia Plans To Support Car Indus With Scrap Rebates (easybourse.com)
So really there is no sense for us to think otherwise or to become intoxicated by some anarchist delusion. In *time* the government may allow the evolution of the auto industry to something else, but there's too much at stake politically to allow a sudden collapse (which would have occurred, no doubt in my mind---all 3 of the D3, gone in 6 months tops, broken up, sold, dissolved, whatever).
That it would be a "horrendous disaster" is pure conjecture, no one really knows the result of such an event and if it would actually help get rid of something that has no business existing. I'm not saying they shouldn't exist but to artificially prop them up may be even MORE disasterous (notice the work "may"). And to say it would be a "sudden collapse" is not really true. They've been going downhill for years, just look at the employment numbers today compared to the past. It's not like they all of a sudden have tanked.
myth (poof).
Maybe they missed the study in the 90’s that showed states with welfare work requirements and sanctions that actually had teeth (miss one or a few of the work rules and you’re out or benefits reduced) showed more reduced caseloads than more lenient states. Toughest sanctions: 60% reduced caseload. Easiest sanctions: 40% reduced caseload. Myths don’t go “poof” because one agency chose certain studies and then “summarized” them with their own conclusion.
The end result is that in 97% of cases, people are paying more now, for that new car, than they would have been, WITHOUT A CLUNKER TO TRADE IN, because of the complete rollback of incentives and charging of MSRP.
Never underestimate the government's ability to perversely distort markets nor the lack of intelligence of the American Consumer.
When this money-dope, taxpayer funded grab that is benefiting dealers ends, dealers will either have to restock inventory and go back to heavy discounting (with the manufacturer), or lay off 75% of their employees, as pent up demand helped diminish their bloated lots, but sapped future demand even more than the anemic economy was doing ordinarily.
Also, look for a lot of lightly used, repossessed cars for sale in the next 6 to 18 months.
Every developed nation on earth is doing it.
We aren't talking about Starbuck's disappearing here. We are talking about 3 megalith corporate infrastructures being wiped off the face of the earth within a few months.
It is intolerable to contemplate, and IMO dangerous to encourage.
There are models to compare to---the annihilation of the British auto and motorcylce industry in the 50s and 60s comes to mind. The repercussions were pretty severe and are still being felt IMO.
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Totally off the mark. It is a beautiful day. I was out trimming my roses and watering the orchard. I have a hope, just not in our City, state or Federal Government. The people will have to stop the madness. It looks like they have reached that point, from the crowds at the various town hall meetings. Hopefully I get to visit with my Congressman this Saturday at Kiwanis. Let him know we are behind him 100% to try and straighten out the mess in DC. It is an uphill battle with that bunch of elitist swine in control.
C4C being the least of the worries and probably already spent.
You've been throwing this fallacy-scenario out there for many months now, when this possibility was not very probable. First Ford was not going out of business. Secondly the failure of one of the D3 would have been a great benefit to the 2 that were still in the game. So if Chrysler were to fail in Nov. this would have boosted sales at Ford and GM, and probably saved them from bankruptcy. Instead of 3 weak companies with not enough business to survive, you'd have 2 companies with enough business to survive.
Third a few suppliers might go out of business that mainly supplied the one company that did go under. MANY suppliers however would see an increase in business as parts orders for the other brands increased.
If anything our government's actions have 1) made it more likely that Ford goes bankrupt, and 2) created a short spike upwards in demand for car sales, which will be followed by an equal counter-action in sales drop after C4C.
I'm not sure where this grim, dark, hopeless, menacing, savage, pessimistic, fatalistic view of America comes from, but wherever it is emitting, my advice to Americans in general is TURN IT OFF, roll up your sleeves, switch on your mind, and get with people who want to solve the problems we have.
Then later this:
How could an economy possibly brush off sudden loss of millions of jobs, the spin on the stock market from those failures, the political fallout, the enormous burden of relief aid, and the global humiliation to American prestige?
We aren't talking about Starbuck's disappearing here. We are talking about 3 megalith corporate infrastructures being wiped off the face of the earth within a few months.
It is intolerable to contemplate, and IMO dangerous to encourage.
There are models to compare to---the annihilation of the British auto and motorcylce industry in the 50s and 60s comes to mind. The repercussions were pretty severe and are still being felt IMO.
That's no less hyperbolic than gagrice's comments about a Depression and both are predicated on the future or a situation that can't be measured at this time. Millions of jobs? Suddenly? How many do each company employ? I realize there are spin-off effects but that is really stretching it to try and make a point. I thought we could "roll up our sleeves"...wouldn't that save a few hundred jobs anyway
Ford is fine and is not getting aid at this time. The other two wouldn't be wiped off the face of the earth (someone would swipe them up) and, again, the repercussions have already been felt (I should know, living in Michigan) as they have downsized considerably. There would still be cars sold in America and many built here as well no matter who picks up the slack.
Chrysler was a corpse when it took Ch 11, and GM was bleeding heavily and had no hope of sustaining business for more than 6 months without a massive infusion of capital. Way too high a burn rate.
Ford was, and still IS, not profitable, as their recent "profit" was merely a write off of past debt.
There's a reason no auto company ever survived Ch 11 since 1934--no private capital was capable of coming up with that kind of money.
Slam-dunk, in my mind, that all three of the D3 would have been RIP by 2010 with no intervention and no changes in structure. The Japanese and Asians would have eaten them for lunch.
By default, your economic position would have to include, in fact encourage, foreign takeover of our major industries and/or dissolution of our manufacturing infrastructure.
To what end one would advocate such an outcome, I can't grasp but I'll try to think of positive reasons for it as I mull it over.
I have some mutual funds that peaked out in share price in 1999, and now, 10 years later, still aren't anywhere NEAR that peak. Now, overall they're still at a profit because I've done automatic monthly investing, so while I might have bought one share one month when it was $100, I ended up buying 10 shares a couple years later when it was down to $10/share, etc. But anybody who stuck all their money in at one time in 1999, is still screwed.
So you don't understand that if Chrysler went out of business, that those domestic auto-buying customers would then go to Ford and GM? Let's say 50% of the people who bought Chrysler products instead went to GM, and the other 50% went to Ford. Don't you think GM and Ford would either show small losses or actually be making profit? You don't understand the business finances that Ford and GM have huge fixed-costs that require a certain number of their vehicles to be made and sold? and that Chrysler going out of business would have increased GM and Ford's sales?
If you don't understand that in terms of business, then you should think about nature and how the detriment of one, is usually the benefit of others.
That might've happened back in 1979, when Chrysler was on the ropes, but I don't think it would happen in this day and age. There's just too much competition across all product lines. Back in 1979, for example, the only area where Chrysler really competed with the Japanese was in small cars, like the Omni/Horizon, TC3/024, and the captive imports. Everything else...compacts, midsize, personal luxury coupes, full-size, big trucks, vans, SUVs, the only other options were Ford or GM. Plus, GM was on top of the world back then, or so we thought. And it wasn't really made public just how bad off Ford was until a few years after the fact.
If Chrysler went under today, I imagine the biggest winners would be Nissan, Honda, and Toyota.
So GM and Chrysler go down, and this completely shakes consumer confidence in Ford, which is also losing money, right?
who wants to buy a car from a car company staggering on the ropes?
Exactly---hardly anyone.
For the 202'nd time. This was created by the auto industry for its own benefit. The auto industry simply got their representatives to legalize it. Distortion? OK. Artificial? Yes in the short term. It always was foreseen as a temporary measure to assist the greater auto industry. The fact that some buyers can take advantage and get significantly lower prices than they might have before is the carrot.
No one could buy an $18000 MSRP Corolla for $13500, even with full discounting and the typical $500 rebate. Based on this one example your complete argument fails. But you are allowed to continue whining.
This is absolutely wrong. Either you haven't been reading these boards or you've been ignoring the facts. It's the well-to-do that are taking advantage of the program first and foremost. They're paying cash in many cases. It's hard to repossess a vehicle if the owner paid cash.
Another misconceived myth stomped to death. STOMP..STOMP...STOMP...next?
Interesting statement here. Now that you mention it the bankruptcy of GM probably saved Chrysler. As shifty has correctly noted the loss of both at the same time never was going to occur. As you correctly noted the loss of Chrysler might have been bearable by the nation.
Unfortunately your argument is based on the supposition that we might have survived Chrysler's death if GM remained alive. But the reality was that GM was just as dead as Chrysler at that time. The argument fails in the face of actual events.
Like the prior poster you're speaking in theory not about actual facts.
When Chrysler was going belly up....GM was also belly up. The facts are that both companies were corpses.
In your theory you're right, the death of Chrysler would have been a good thing for the other two. But your theory ignores the actual facts. GM was just as dead as Chrysler was. Such short memories here.
But in fact both administrations did the right thing...for the companies, the workers, the local communities and the nation.
Putting all your money in all at once will screw you everytime.
This is absolutely wrong. Either you haven't been reading these boards or you've been ignoring the facts. It's the well-to-do that are taking advantage of the program first and foremost. They're paying cash in many cases. It's hard to repossess a vehicle if the owner paid cash.
Another misconceived myth stomped to death. STOMP..STOMP...STOMP...next?
Again, you're pompous in your reply, as if you're the final word. As if these boards or your personal experience is the end all of the "facts" surrounding the purchasers of the cars and what is going to happen in 6 to 18 months. NO ONE can say with certainty if he is "absolutely wrong" until those 6 to 18 months have passed. Do you have the credit score, job situation (and know their future job situation) and net worth of everyone that has participated in C4C? Until you do and have some hard statistics, maybe you should quit annointing yourself the mythbuster and quit making absolute statements about ideas or predictions from people you disagree with.
Okay, quit STOMP-STOMP-STOMPing and get back to SELL-SELL-SELLing. My Toyota stock needs a boost! :P
The facts that came to be were a RESULT of keeping Chrysler alive; it's like saying". I agree GM was dying with the status quo the way it was. The government however was what kept the status quo! So the "facts" did not occur naturally, but were artificially created. What I'm talking about is what would have occurred in a natural market.
What you are not considering is that if Chrysler were allowed to fail, and there was even a few days after that which GM could keep going, the facts would be a lot different. The facts then would have been a lot more investor interest in Ford and GM, and Ford and GM could raise money through bonds and stocks, and meanwhile cut their expenses. I can guarantee you that if Burger King goes bankrupt tomorrow McD's and Wendy's are going to make lots of , and be a good stock to buy tomorrow morning.
Maybe it would have been GM going out first though as Cerberus certainly had the $ to keep Chrysler open, and wait to pickup the larger GM customer-base.
But in fact both administrations did the right thing...for the companies, the workers, the local communities and the nation.
There are no "facts" in your conclusion, only opinion. We don't know if they did the right thing because we don't know what would have happened if they would not have acted. There's no way to prove the long-term consequences one way or another of inaction at this point. Short-term consequences would certainly be more predictable but it doesn't mean the wrong thing was done in the long term for the overall nation.
I also respectfully disagree. I would bet that the demographics of Chryslers products would put the vast majority of their buyers in a Ford or GM. Or conversely GM buyers would go to Chrysler or Ford. Most truck and SUV buyers will only buy D3 vehicles. People who are buying 300C's and Dodge Chargers aren't going into a 4-cyl Accord. About the only group of Chrysler buyers I'd see going to Nissan, Honda, or Toyota would be the minivan group, if they didn't buy a Ford Flex or Chevy Equinox.
I suppose someone (not meaning you, just anybody) could suggest that GM was just creating a false catastrophe in order to get bailout money, but really going into a forced Ch 11 on government order is hardly a benefit or a good business move. The conspiracy makes no sense.
The "facts" may be elusive but one fact is sure---GM and Chrysler tried to get OUT of Chapter 11 as fast as humanely possible.
Why?
Because they fully realized that the onus of Ch 11 kills a product's reputation.
Think about it. Chrysler dies on Monday, GM dies on Tuesday, and you're going to buy a Ford on Wednesday?
I'm also not sure how the "natural market" is automatically privileged as a concept to be granted any wisdom---the jungle is "natural" and so are viruses but they don't always produce pleasant or beneficial results.
But you work at a Toyota dealer, people that buy Toyota's are displaying some brains and smarts. Hardly a representative sample of clunker buyers.
I'd want to hear who's taking advantage of the clunker giveaway by the gov't at a Chrysler dealer. Anyone willing to buy a Chrysler these days has to be both pretty dumb and pretty stupid in my opinion. I have a feeling no one earning 30K a month would even consider a Chrysler, unless those earnings are from an inheritance of some kind. Probably no one with a reasonably high IQ would consider a Chrysler.
Just heard over the weekend, an acquaintances Pacifica blew a tranny at like 34,000 miles.... took it to dealer, they told him he was on a long waiting list and could be looking at 35 days or more until a new tranny would be made available by the bankrupted Chrysler. Guess a lot of trannies are still blowing over there at Chrysler!!! How could they possibly get so far behind on making replacement parts???? Anyway, as you can imagine, the dealer was not cooperative, forthcoming, nor willing to provide a rental/loaner vehicle in the meantime. Another lost customer forever.
But stomping out unfounded factless statements stated as fact but base purely on negative speculation is part of the interaction of internet forums....especially when this subject has been covered over and over again. I've stated several times herein that in our view from selling Toyota's this factless speculation is false. From others herein selling other brands it appears that our perception is accurate.
'Speculative facts' need to be stomped out of existence. Speculation is fine 'It might turn out that some buyers might overburden themselves, but at present there's no indication that this is occuring.'