The Loma Prietan - November/December 2009

When our September-October (print) issue described the government's Cash for Clunkers program, enthusiasm was high despite some disappointment with the goals. After the closure of the program, due to exhaustion of the $3 billion allocated, much had been achieved.

Consumers bought nearly 700,000 new vehicles, with an average fuel efficiency gain of 9.1 mpg. Despite concern that the lower gain required for trucks — 5 mpg vs. 10 for cars — would reduce the overall effectiveness of the program, trucks, SUVs, and vans comprised 84 percent of the vehicles traded but only 41 percent of new vehicles purchased.

The most commonly "clunked" vehicles included the Ford Explorer, Jeep Cherokee, Dodge Caravan, and Chevrolet Blazer. Top vehicles purchased include the Honda Civic, Ford Focus, Toyota Corolla, and Hyundai Elantra.

The program also helped the economy by increasing sales and production. Car sales rose 10.6% in August, with some dealers selling more than triple the number of vehicles they had anticipated under the program. Ford and General Motors recently announced production increases for the remainder of 2009, and Honda said it will ramp up production at three of its U.S. plants.

California dealers received the largest chunk of funds, at $323 million, followed by Texas at $188 million. New York, Florida, and Illinois rounded out the top five recipient states.

Coryne Tasca is a member of the Loma Prietan Editorial Board.