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Scrappage Bill Aims to Spur New Car Demand

Cash-for-clunkers program paid off in German auto market.

by on Mar.18, 2009

Could a cash-for-clunkers program revive the U.S. auto industry?

Could the proposed cash-for-clunkers program revive the U.S. auto industry?

Cars, trucks and crossovers are lasting longer than ever, according ot the  latest research.  Too long, perhaps, giving motorists one less reason to go back to their local dealer during the current economic crisis.

“Manufacturers have done such a good job improving long-term durability,” says Neal Oddes, an executive with the market research firm, J.D. Power and Associates,” that consumers are keeping their cars longer than they have in the past.”

Is that why sales have plunged from more than 17 million a year, earlier this decade, to barely 10 million, at current rates?  No, but it certainly is a factor.  So, short of sending the repo man around to tow the oldest cars away, what can be done to spur demand?  German lawmakers scored a direct hit, earlier this year, when they introduced a clunker-for-cash program.  Significantly, Germany was the only major market in Europe that posted an increase in new car sales, last month, but the increase appears to have boosted the sales of non-German brands more. (more…)