Cash for Clunkers Program Ends: What Will Happen to Car Sales?
New vehicle sales plunged in September, following two busy months of car buying thanks to the government’s cash-for-clunkers program. Now that the federal buyback program has ended, most automakers experienced a double-digit decline in sales as compared to a year ago.
General Motors announced its sales dropped 45 percent, and Chrysler reported a 42 percent decline from September a year ago. Ford fared a bit better with car sales declining only 5 percent from September 2008. However, Ford did register a 5 percent uptick in sales for the entire 3rd quarter, the company’s first quarterly increase in four years.
Overseas automakers were also hard hit in September. Sales dipped 20 percent at Honda, 7 percent at Nissan, and 13 percent at Toyota.
Korean carmaker Hyundai was the lone bright spot in the industry. Hyundai said its sales rose 27 percent in September. Due to its low priced cars, the automaker has been gaining sales momentum throughout the recession.
The federal cash-for-clunkers program generated almost 700,000 sales in July and August, bolstering carmakers. The program provided up to $4,500 in credits to consumers who traded in an older, inefficient vehicle and bought a new one with better gas mileage.
Tags: Cash for Clunkers