“Cash for Clunkers,” which officially launched on July 27, is already
seeing a decline in interest, after receiving an additional $2 billion
dollars in funding just days ago, according to Edmunds.com.
Purchase intent data from Edmunds.com shows that interest peaked for
“Cash for Clunkers” on July 29 but has since declined by 15 percent.
“The funding for the original program was very low in relation to the
size of the auto market. This created a Gold Rush mentality where
consumers hurried to take advantage before funding ran out. With
additional funding now approved, there is no longer an urgency to
participate in the program,” said Michelle Krebs, senior analyst for
Edmunds.com. “Interest in the program is fading as fast as the first
billion dollars was used up.”
The Edmunds.com analysis was based on Internet shopping purchase intent
data. It also showed that if current trends hold, purchase intent would
be back to pre-“Cash for Clunker” levels by Aug. 20.
“Despite this decline in clunker activity, we expect auto sales to be
improved through the summer as value-oriented consumers look for deals
before new models start arriving,” said Jessica Caldwell, director of
industry and pricing analysis for Edmunds.com. “The real risk is this
fall and whether the economy will have picked up to keep sales at