‘Clunkers’ Consequences: GM Sales Down, Ford Gas-Guzzlers Up

When Congress tripled the size of the "cash for clunkers" program in July, both Congress and the White House
billed the $3 billion program as a boon for struggling domestic
automakers. But when those Detroit car companies released sales figures
today, the numbers didn’t quite match up to the hype.

082409_clunker1__1251140010_9010.jpg(Photo: AFP/Getty)

General
Motors and Chrysler, which required a combined $65 billion in
government loans before declaring bankruptcy, reported August
year-to-year sales declines of 20 percent and 15 percent, respectively.

Detroit media reports focused
on GM’s 30 percent sales increase between July and August 2009, but the
company’s car sales were down 1 percent even after being "bolstered" by
the taxpayer-funded "clunkers" rebates.

Ford, the lone U.S.
automaker that did not require a government rescue, reported a 17
percent year-to-year sales increase in August. As the New York Times
reported, the company was pleased by one sales jump in particular:

At Ford, sales of the F-series, a large pickup truck popular among
building contractors, rose for the first time since October 2006, a
positive sign for the automotive market and the broader economy, the
company said. Ford sold 13 percent more of the F-series and 57 percent
more of a smaller pickup, the Ranger.

“It may be a glimmer of
hope,” Ken Czubay, Ford’s vice president of marketing, sales and
service in the United States, said on a conference call.

The F-150, the most well-known of the F-series trucks, gets an average of 16 miles per gallon (mpg) of gas. The Ranger gets between 16 mpg and 23 mpg, depending on the engine and transmission. "Glimmer of hope," indeed.

  • I believe neither the F-150 nor the Ranger qualifies for cash for clunker rebates. Could someone verify this? I don’t know why it was bundled in the same article.

    Also, if indeed the trucks are being snatched up by contractors and not commuters, isn’t that the purpose of trucks? There aren’t really viable alternative, truly fuel efficient, mobile hauling vehicles. Yes, someone in this forum will cite some utility bike that exists. But what options are there for better than 20 mpgs and a 1 ton rating?

  • Chris

    Pickups such as the F-150 and the Ranger could qualify for the program. Someone trading in an old full-size pickup (or “category 2 truck” in bureaucratese) for a new full-size pickup could qualify for a $3500 credit even if the new pickup was only one mile per gallon more efficient than the old pickup. They could qualify for a $4500 credit if the new pickup was two mpg more efficient. See http://www.cars.gov/faq.

    Replacing a 15 mpg vehicle with a 16 or 17 mpg vehicle, however, results in significantly greater fuel savings than replacing, say, a 30 mpg vehicle with a 31 or 32 mpg vehicle (assuming the vehicles are driven the same distances). I’ll let others debate whether the fuel savings are big enough to justify the multi-thousand dollar credits.

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