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Dealerships experience Cash for Clunker hangoverby David Catanese, KY3 News political reporter
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SPRINGFIELD -- It's been just about a month since the popular Cash for Clunkers program ended. You don't need to look much farther than the showroom floor to see that the customers dropped off along with the incentive. Missouri car dealers took advantage of $62 million in Clunker vouchers. Now that the car party is over, some wonder if the hangover is worth it. Reliable Toyota in Springfield had its second best August in history thanks to the $4,500 incentives to trade in gas guzzling vehicles. Now lots are sparsely populated due to low inventory, and buyers are harder to find. "Of course as soon as that program ended, it was like turning of the spigot," said Tony Stubblefield, Reliable general manager. The dealership is on pace to sell 50 fewer cars in September than August. Last month, it sold 270 vehicles and took in 137 "clunkers." This month, Reliable is on pace to sell around 220 cars. Stubblefield appreciated the late summer surge, but he thinks all the Clunker cash might have done is take some of the flurry out of fall sales. "Now we've taken, probably, some business from September and October, so we're probably going to see a softer September than we would normally see," Stubblefield said. Economist Tom Wyrich is even tougher. "This has amounted to destroying wealth -- capital goods -- and that is not smart. It's stupid," said the Missouri State University economics professor. Wyrich notes the program was popular because most people didn't think about how it impacted other sectors of the economy in much smaller ways. "People have to make all these car payments and, when they start making payments on these new cars they're buying, they don't have the money to go out to Applebee's or buy something at the mall at Macy's," he said. In essence, it's the redistribution of wealth and a shift in the economic activity time line. Those on pace to buy a car in two years instead bought it now. In the end, Wyrich predicts it will all even out. "So car sales are up this year but they'll drop off in the future," he said. For the most part, Stubblefield agrees. "What we're seeing in September, it looks to me like it might just balance itself out," he said. Get more political news on the KY3 Political Notebook. Get TWITTER updates from Dave Catanese HERE. Most PopularMore Good Stuff |
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