HolyCoast: Ridding America's Roads of Detroit's Products
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Thursday, August 06, 2009

Ridding America's Roads of Detroit's Products

The Washington Examiner has examined the stats from the Cash for Clunkers program and finds the program is doing one thing very well - taking Detroit's automobile products off our highways:
You've probably heard that Detroit vehicles are faring well in the cars-for-clunkers program. But that appearance may be entirely the result of the Department of Transportation's selective release of data.

Here are the new top-ten lists for the Cash-for-Clunkers program as of last night. Among the 184,304 purchases so far, here are the top ten purchased cars:

1. Toyota Corolla
2. Ford Focus FWD
3. Honda Civic
4. Toyota Prius
5. Toyota Camry
6. Hyundai Elantra
7. Ford Escape FWD
8. Dodge Caliber
9. Honda Fit
10. Chevrolet Cobalt

Note that six of the ten, and four of the top five, are Japanese models.
Now, here are the top ten trade-in "clunkers":

1. Ford Explorer 4WD
2. Ford F150 Pickup 2WD
3. Jeep Grand Cherokee 4WD
4. Jeep Cherokee 4WD
5. Dodge Caravan/Grand Caravan 2WD
6. Ford Explorer 2WD
7. Chevrolet Blazer 4WD
8. Ford F150 Pickup 4WD
9. Chevrolet C1500 Pickup 2WD
10. Ford Windstar FWD Van

The department provides a percentage breakdown on Cash-for-Clunkers purchases, revealing that about 45 percent of the new cars bought under the program are Detroit models -- roughly in line with their current market share. However, the Department of Transportation spokesman Derrell Lyles tells me he cannot provide me at this time with a similar percentage breakdown for clunker trade-ins. Given that the top-ten list of clunkers is 100% Detroit, this could be an important number.

For example, if 90 percent of the clunkers and only 45 percent of the new purchases are Big-Three cars, that means consumers are taking advantage of this program to abandon American-designed (in some cases government-owned) brands in huge numbers. One might expect an average car buyer to purchase Ford, GM and Chrysler only 45 percent of the time, but is it not different if the pool of buyers is largely made up of people who already own those brands?
I wonder how much of this reflects concerns that the Big Three won't be around in a few years to service their older cars, so better to get rid of them now and get something else?

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