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I looked today. out of 106 C4C transactions 49 of them were cash no lien holder. Out of all the deales we submitted for financing we had 1 turn down that was C4C. One person had bad credit. IMO that is amazing. The exact opposite of what we thought would happen when the program came out.
But if I had a nice Town Car, ideally the basic Executive series (no flaky suspension) I'd hang on to it. Not for collector potential, mind you--just because for what it is, it's a really nice ride.
As for consumers that did the CFC..... there non in my area that were credit challenged.... maybe a the lowest score was around 680 but that was only because they ahd a lot on their breau (what ever way you spell it)
Who are you agreeing with? MVs is saying that most of the C4C buyers CANNOT afford a new car. It sounds like you're saying the opposite.
He did make out as it probably only had about a $500 trade-in value.
Yes, perhaps that the car was for someone else and he is now going out to buy a new Lincoln Contental (which will be essentiall the same car as his old one was when it was new, right?) for himself.
He could even turn around and sell the Aveo and use the money toward a new car and come out ahead of where he would have been had he just traded the Lincoln for $500.
When I was a social worker many years ago I would often help a client apply for food stamps, medicaid etc. The biggest problem was the red tape which demanded proofs EXACTLY as the manual stated. Applications were rejected for the most anaine reasons because they didn't fit the standard model. I had one woman rejected because she had been brought to a hospital just across the county line. She was told she had "abandoned" her home by "moving" to the hospital.
So I feel for the car dealers but when you go for welfare you have to deal with the system.
2019 Kia Soul+, 2015 Mustang GT, 2013 Ford F-150, 2000 Chrysler Sebring convertible
My local Ford stores' lot looks like a ghost town. Even the used car lot is almost empty.
2019 Kia Soul+, 2015 Mustang GT, 2013 Ford F-150, 2000 Chrysler Sebring convertible
Not exactly a real Lincoln and not worth crying over.
LOL..... I though the same too Joel.... I have to say it this has been my best month in the business in 6 years.... :shades:
GP
I was agreeing with who ever mentioned the "Millionaire Next door book".... and the fact that there are alot of people who have a lot of money that don't have to have expensive houses or fancy cars..... If MVS didn't agree with that than my bad... I must have read his post wrong.
Thanks for the correction,
GP
TOo be continued....
That's great!
For C4C, I bet the most tech savvy dealers (those can handle the computer transactions quickly and without mistakes) win.
I have read that C4C can compress the new car sales in a few weeks, such that much less new car sales will occur in the following months. Let's see if this prediction will hold true.
Please keep us posted. Thanks!
My original statement was based off an msn article I read from Sunday night, it was then challenged as 'opinion', and then the poster followed up with their opinion based on reading a book...
We'll all learn what this program has created down the road- clunker hangover, pulling sales forward, short term boom, benefits only for the millionaire next door, vehicle repossessions, or none of these.
I am surprised with the information you have on cash deals.
I'm not certain if customers will never be upside down....Question, if clunker deals are closer to MSRP, and this program exhausted most of the remaining 2009s, which are already a year old with 2010s out or hitting lots in 4-6 weeks, wouldn't the clunker money basically offset the first year depreciation?
Manchester sticks to a firm pricing strategy which is $600-700 under invoice, they pass no rebates or incentives to the customer (at least not in our quotes), although I have not dealt with them in the past. They had three available vehicles, but again not our color choice. I was amazed they had three when other dealerships had zero for quite awhile and couldn't get them in.
Aside form this one time during this program, tri-state dealers have always followed up with us quickly.
My guess is we'll see many clunker repossessions in the news over the coming months.
they have a very good rep for customer service.
i think their pricing policy has always been to give you a number, and it is what it is.
not sure what colors they have remaining, but i will bet they have not found a buyer yet, where color and discount are not on top of the list.
i am also guessing you won't bring it there for service.
Myself, Joel, Spyder and others have been saying most of these were cash since the program started. Look at what happened to the savings rate over the past year plenty of people were socking money away because they were afraid to spend it.
I can't speak for the rest but we didn't' sell any cars for anywhere near MSRP.
We are in a very competitive market and everyone got all their incentives plus some additional discount. On a 40,000 dollar Volvo there was probably 6,000 in incentives, dealer cash incentives not customer rebates, from Volvo plus the clunker money plus another 1,000-2,000 in discount from us plus potentially some owner loyalty rebate money.
That person paid right around 30,000 or a little above that with taxes.
Did we go hundreds or thousands of dollars behind on any deals? No, but no one paid MSRP either. We haven't had any deals thousands behind invoice since we cleared out our remaining 2008s anyway.
You nailed it! IMO, this C4C debacle will hurt his plans to reform health care, just more and more government spending pushing us further and further in debt. How much more can it go before we start seeing serious consequences?
I saw a bumper sticker today, I'll keep my guns and religion, and you can keep the "change".
Based on the numbers I've found on a few different sites the total number of cars sold under this program is between 630,000-700,000
http://green.autoblog.com/2009/08/24/cash-for-clunkers-ends-tonight-8-p-m-est-2-- - 65-billion-spent/
Let's say the persons you mentioned and your dealership sold 1000 cars under this program (assuming customers paid cash for all of these) and you use the low number in the link of 630,000 vehicles...what's that .15% of the total vehicles sold?
The lenders loved it. Not only were the clientele in the upper scale of normal buyers with nearly pristine credit credentials ( the most sought-after buyers ) but just as importantly all the vehicles purchased with the Cash credits put the lenders in a more secure position. No Negative Equity with these buyers.
You may not like the program and are searching for any negative press you can find, this program gave the auto industry a shot in the arm when the COUNTRY needed it. Is it going to miraculously get us back to 2006, no way. But it is the first government spending program where you can tangibly measure the success.
BTW, do a simple Google search and what kdhspyder is saying about the Cash for Clunkers bill is true. Don't necessarily agree about it being Republican based and don't understand the Mexico part either. I've been to Cancun twice and if I was forced to live there, I'd be pretty happy. ..... The initial bill was designed to be an environmental bill targeting pickups and SUVs and encouraging the purchasing of hybrids. That bill got no traction at all esp since it would have benefited Toyota and Honda.
Based on the tone of your post, do you rally want to give Obama credit for such a successful program? Did you forget about the two stimulus packages under Bush; the $700B bank bailout under Bush; the initial loans to GM and Chrysler Bush approved despite objections from Congress. I don't agree with the government spending but if you really want to play the political blame game, let's get the facts straight.
There is enough blame to give everyone for the mess we are in.
You do know C4C style programs have existed in many nations on the continent for some time...
You can't really believe it matters at all who you vote for...all candidates bow to the same special interests.
NEW YORK (CNNMoney.com) -- With the final numbers now in, the Department of Transportation said Wednesday that nearly 700,000 old cars had been traded in for new ones under the Cash for Clunkers program.
"This is one of the best economic news stories we've seen and I'm proud we were able to give consumers a helping hand," Transportation Secretary Ray LaHood said.
Shoppers had until 8 p.m. ET Monday to buy a car under the Cash for Clunkers program and dealers were given until 8 p.m. Tuesday to file their paperwork on-line to request a government voucher.
Auto dealers submitted total of 690,114 requests for vouchers, according to LaHood. Those requests totaled about $2.9 billion, or just under the $3 billion that had been allocated for the program.
he average vehicle purchased under the program had fuel economy of 24.9 mpg in combined city and highway driving compared to an average of 15.8 mpg for vehicles being traded in.
That's an average fuel economy improvement of about 58%. The new vehicles being purchased also had 19% better fuel economy than the average vehicle available on the market today.
The statement was..
That's an average fuel economy improvement of about 58%. The new vehicles being purchased also had 19% better fuel economy than the average vehicle available on the market today.
It should read...
That's an average fuel economy improvement of about 58% [ in the fuel economy rating ]. The new vehicles being purchased also had 19% better fuel economy [ rating ] than the average vehicle available on the market today.
Actually the savings in fuel usage are the key issue. Here is the real math..
Average of the 'clunked' fleet ( on paper ), 15.8 mpg. This means that if the 'clunked' fleet still was able to get its original EPA ratings ( very very doubtful ) then those 690,114 vehicles would have used 63.3 gallons on average to travel 1000 miles. Since many of these were very old and very inefficient that 15.8 mpg rating is good only on paper.
Average of the new purchased fleet ( in reality ), 24.9 mpg. This means that those new 690,114 vehicles would use 40.2 gallons on average to travel 1000 miles.
The net savings for the country, at a minimum, is 23.1 gallons on average for every 1000 miles travelled for each of the 690,114 vehicles now on the road. At 15,000 mpy travelled by most drivers now that comes to...
...239 million gallons not purchased, not used, not burned...each and every year. That's money that stays here in our pockets
If you have several different dealers in different geographic an demographic areas all telling you that the majority of the buyers were cash buyers or had Tier 1 Triple A credit then there is a good chance that is true for the rest of the program.
Joel is in TN selling domestics and he saw the same thing that I saw up in CT selling mostly import euro cars. Greenpea saw the same thing in Mass and Spyder saw the same thing in VA selling many different makes.
I think Craig saw something similar out in the northwest. Everyone that I have talked to that has done clunker deals mentioned how many cash buyers there were and how frustrating the F&I people were.
I didn't pay cash but I did qualified for the 0% financing and I was surprise the F&! people didn't try to sell me an extended warranty or credit life.
Conserve your cash use Ford's/Toyota's/Honda's cash instead.
If you have an alternate investment with which you can reasonably expect a 2.9% or better APY, then this is correct. The S&P 500 has gained something like 40% in the last six months--but it's still worth less than it was a year ago. The stock market is still volatile, and many folks can't take the uncertainty. In that context, many people will opt for the increased liquidity of a larger-than-usual cash reserve, even if it means maintaining debt that would otherwise be paid off.
Hang on to your cash even in a low interest bearing account for other use then tie it all up in a car purchase.
If something bad happens, job loss or forced relocation for example, you have your cash to pay for that or you could pay down part of the loan early on the new car and get out of it whenever you need to.
Where in CT are you? I'm in CT as well.
You would have received 3500-4500 for a Trooper that had virtually no value. You would have paid MSRP less a 3000.00 rebate and you got stubborn because they wouldn't come off MSRP?
So now, you are installing a new engine in a car that won't be worth much more with that new engine.
Suppose something else breaks?
Suppse someone runs a light and hits it. It would take very little to total it!
I'm no fan of Kias and I've never even heard of a Borrego but I think you should have jumped on that deal!
Just my opinion.
I don't think so. 30K MSRP w/ 3K rebate and C4C would put it around 24-25K after taxes. Edmunds shows 3 year depreciation at 15K, so at the end of 3 years he would be out 9-10K.
How much does an engine run? 2-3k?
Sounds to me like it make a good financial decision passing on the Kia.
However, the additional 2 bil reminds me too much of helping a down and out friend or relative and they come back 2 weeks later with their hand out again. :P
So all these klunkers would have continued to run forever had they not been klunked? Your math is off, the gasoline savings would only be for the remaining miles.
If, say, the average klunker had 30K mi of life left in it, then the best case is a savings of about 460 million gallons, assuming the rest of your math is accurate. This came at a cost of nearly $3 billion, which is more than $6 per gallon of fuel saved.
Beyond this you do not know is someone klunked an F150 for a focus and then will shortly go out and buy a new F150. I noticed Ford ad last night, they had been advertising this cars program but have already switched to advertising big rebates on the F150.
His trooper must have the 2.8 GM six cylinder which was a garbage motor. One of the worst V6s GM ever made. The newest it can be is a 1991 as that was the last year the 2.8 went in that car. The Trooper that year got 15 combined but if his engine was ticking and smoking no way was it getting 15 combined anymore. An improvement of three miles per gallon from 15 is not a huge improvement in raw terms but is a huge percentage improvement. That is a 20% increase in gas mileage. You get a newer larger truck that has more safety equipment gets better mileage and pollutes much, much less.
The only price so far I can find for 2.8s is here.
link title
2,500 bucks plus installation which I would guess would have to be at least a grand maybe more I have worked on those Troopers before but never put a motor in one. I mean I guess if the truck is in good shape but the engine then a minimum of $3,500 bucks to get another 100,000 or so miles out of it is ok. I wouldn't do that not with that worthless 2.8 motor though.
Its still an old truck with almost no safety gear.
I wouldn't call your biased information a sampling. Due to the limited size of your observations the sampling error present means it's quite far from the actual population.
My opinion is that this program will result in a high number of repossessions and month's from now we'll be reading/seeing it online/papers/kindle/news.