Blogger, Avery Goodman, whose math and analytical skills are beyond reproach in my book, presents the case this way. Some buyers will qualify for the $3,500 government handout, and others will qualify for the $4,500. If everyone qualified for the $4,500, then 222,000 vehicles would have just been sold through the program, and if everyone qualified for the $3,500, you come up with 286,000 total program sales.
If the program results in 222,000 cars sold as a result of the $1 billion dollar program, only 22,000 were incremental sales. The rest would have occurred by November anyway. One billion divided by 22,000 and you get $45,354 per car sold as a result of the Cash for Clunker plan.
So… besides the fact that increasing the demand for clunkers by offering a government check in an inflated amount for purchasing a car made in South Korea is a monumently stupid idea… And besides the fact that the clowns in charge created and launched, with much fanfare, a three month program that ended up lasting only a handful of days… On top of those well laid plans, we’re paying as much as $45k a pop?
Thanks to DD fort he tipoff!
2009 Frankfurt Auto Show Photo Gallery
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