Well, it seems that despite the notion that ‘cash for clunkers’ was nothing more than a giveaway is perhaps only partly true.  This was another giveaway and it may ultimately pull away consumer spending from other sectors now that there are many more car payments.  But the actual numbers of cars and the actual MPG savings in the fuel economy that resulted from the program is at least fairly impressive to someone who has been very skeptical of this entire notion.  It turns out that car dealers cleaned out much of their inventories and can now run on an order basis and lighter inventory level.  The Department of Transportation released its figures and said that as of Tuesday night there had been some 690,114 clunkers taken off the roads which were replaced by more fuel efficient vehicles.

The rebate application tally came to $2.877 billion submitted, just under the $3 billion provided by Congress to run the program.  While American-made cars led the list, it is not just American companies which saw the biggest gains.  Toyota Motors (NYSE: TM) led with 19.4% of the units, General Motors had 17.6%, Ford (NYSE: F) had some 14.4%, and Honda Motor Co. Ltd. (NYSE: HMC) showed 13%.

Now that auto inventories are dry, the government is pointing to manufacturing plants recalling furloughed workers or adding shifts.  The more interesting figure is the projection to what this adds to the economy.  The program is now projected to have boosted economic growth in the third quarter by 0.3% to 0.4% at an annual rate thanks to increased auto sales in July and August.  More importantly, the new projection is that this will sustain the increase in GDP in Q4 as production is hiked to refill some of those inventories.  On the jobs front, the DOT said this will have created or saved roughly 42,000 jobs in the second half of 2009 as Ford, GM, and Honda have announced production hikes.

And the tally is good for the fuel economy — unless you are an oil company. The DOT noted that 84% of consumers traded in trucks and that 59% bought passenger cars under the program.  That is not a 1:1 ratio of course, but still better than what it was before.  On a miles per gallon basis, the average MPG for vehicles traded in was 15.8 MPG, and the figure being touted for the vehicles purchased was 24.9 MPG.

The number of dealer transactions submitted was 690,114 for a dollar amount of $2.877 billion.  The top 10 vehicles purchased are as follows:

• 1. Toyota Corolla
• 2. Honda Civic
• 3. Toyota Camry
• 4. Ford Focus FWD
• 5. Hyundai Elantra
• 6. Nissan Versa
• 7. Toyota Prius
• 8. Honda Accord
• 9. Honda Fit
• 10. Ford Escape FWD

The top 10 trade-ins might not technically be clunkers, but they were all gas guzzlers:

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

Vehicles Purchased by Category…

• Passenger Cars: 404,046
• Category 1 Truck: 231,651
• Category 2 Truck: 46,836
• Category 3 Truck: 2,408

We took out the states that had under $50 million in vouchers, but the largest states by dollar amount in vouchers are as follows:

• CALIFORNIA $326,822,000
• FLORIDA $146,565,000
• GEORGIA $70,496,000
• ILLINOIS $143,613,000
• INDIANA $65,797,000
• MARYLAND $74,903,000
• MASSACHUSETTS $64,855,000
• MICHIGAN $132,407,500
• MINNESOTA $73,160,500
• MISSOURI $61,271,500
• NEW JERSEY $103,375,500
• NEW YORK $156,292,000
• NORTH CAROLINA $78,601,500
• OHIO $136,267,000
• PENNSYLVANIA $138,651,500
• TENNESSEE $50,949,000
• TEXAS $183,776,500
• VIRGINIA $98,523,500
• WASHINGTON $55,927,500
• WISCONSIN $70,165,000

There is full data at the DOT site with more detailed data.  At least this money didn’t go down the black hole at AIG….

JON C. OGG

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