Study Finds Clunkers Program Helped Japanese Carmakers Far More Than Detroit 3
By Scott Doggett November 16, 2009
A recent study evaluating the effectiveness of this summer's cash-for-clunkers program concluded that cost U.S. taxpayers $3 billion and did more to help Japan's three largest automakers than it did the Detroit 3 of General Motors, Ford and Chrysler.
The Japanese companies accounted for only 8 percent of trade-ins but 41 percent of new-car purchases, according to the new study by the University of Michigan's Transportation Research Institute.
By contrast, 85 percent of the trade-ins were manufactured by the Detroit 3 while only 39 percent of the new purchases were GM, Ford or Chrysler vehicles.
Sixty-eight percent of consumers who traded in a Toyota, Honda or Nissan bought another from one of the same from one of the three Japanese automakers.
Specifically, those owners who traded in Hondas bought another Honda 30 percent of the time. Nissan owners bought new Nissans under the clunker program did so 19 percent of the time and motorists unloading Toyotas turned around and bought another Toyota 44 percent of the time.
By contrast, 43 percent of consumers who traded in a Detroit 3 vehicle bought another Detroit 3 vehicle. Chrysler owners bought new Chryslers in 11 percent of the cases, Ford in 24 percent and GM in 32 percent.
As for those who switched, Japan's Big 3 got 38 percent of consumers who traded in a Detroit Big 3 vehicle. Toyota did best, with 18 percent. The Detroit Big 3 got only 12 percent of consumers who traded in a Japan Big 3 vehicle. GM did best with 5.3 percent.
The study made no attempt to determine how much of the money stayed in the United States and how much went to Japan. It should, of course, be noted that many of the Japanese cars purchased as a result of the clunker program were undoubtedly made in the USA.
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