(Source:  Mint.com via Autoblog)

Ever wondered what’s the state of the american auto industry? Over the past several months we came across several reports of the ailing American autopia, including those with horrific financial reports, Government bailout in billions, mergers and acquisitions that changed the auto industry landscape worldwide, the glorious performance of American automakers during the short lived Cash for Clunkers boost, etc.  Along the way, there were few attempts to depict the ever-changing amoebic state of the auto industry from a 30,000ft level, in an easy to understand format.  But so far (what little I have read), nothing comes close to what the brilliant folks at Mint.com have done.

Image Courtesy: Mint.com - Click the image to see an enlarged version

They say a picture is worth a thousand words, and we’d add that the above graph is tantamount to an engaging novella. It charts the massive brand exodus among the Detroit contingent, which looks like a quadruple reverse drawn up on the telestrator by John Madden. If that isn’t sobering enough, the text below shows just how much Detroit automakers have shrunk since 2006. Overall, attrition at Ford, GM and Chrysler accounts for an astonishing 144,600 workers in only three years. No wonder Michigan has the highest unemployment rate in the nation. The chart also gives a brief look at the up-and-coming members of the US auto industry, including Tesla, BYD, Tata and Smart, along with a quick blurb about the future of each of the automakers represented.

TranspotGooru Musings:    The only glitch that I spotted in the above graph is the introductory line on the blurb about Chinese Automaker BYD – “Recently bought by Warren Buffet….”  Actually, the company is publicly traded, and its major shareholder is Wang Chuan-Fu who started BYD (the letters are the initials of the company’s Chinese name).  Mr. Buffet’s Bekshire Hathaway has invested $232 Million  thus far and is consider to expand its investment further. Berkshire Hathaway first tried to buy 25% of BYD, but Wang turned down the offer. He wanted to be in business with Buffett – to enhance his brand and open doors in the U.S., he says – but he would not let go of more than 10% of BYD’s stock.

(Source: Time; Autoblog)

With 690,000 vehicles sentenced to one final gargle of sodium silicate, thanks to the now-defunct Cash for Clunkers program, demolition-derby drivers seem to have been left holding the short end of the driveshaft. What the government seems to have forgotten is that many cars, hobbling and sputtering as they near death, prefer to make one final trip to the local county fair (assuming they escape a 24 Hours of LeMons team). There, stripped of glass and with fuel tanks moved safely inward, the clunkers die an honorable death smashed gloriously to pieces in front of large (and often well-hydrated), cheering crowds.

There’s at least one group of people who are happy Cash for Clunkers is over: demolition-derby drivers. Participants in these events, in which drivers smash into one another until there’s only one engine left running, don’t enjoy the sight of old cars going out of commission without making a pit stop at the county fairground. “Obama is an anti-demo-derby guy,” says Tory Schutte, head of the Demolition Derby Drivers Association. “He’s targeting the cars we’ve been using.”

There’s at least one group of people who are happy Cash for Clunkers is over: demolition-derby drivers. Participants in these events, in which drivers smash into one another until there’s only one engine left running, don’t enjoy the sight of old cars going out of commission without making a pit stop at the county fairground. “Obama is an anti-demo-derby guy,” says Tory Schutte, head of the Demolition Derby Drivers Association. “He’s targeting the cars we’ve been using.”

There are an estimated 3,500 derbies in the U.S. each year, and they tend to be the main attraction at county fairs, where attendance has hit record highs in many places this summer. “It’s been a stellar year for fairs across the country,” confirms Marla Calico, spokesperson for the International Association of Fairs & Expositions.

(Source:  Time)

Q’Orianka Kilcher has never pumped a gallon of gasoline into her car. Never. Then again, she’s never owned a car that needed gasoline. You could say she is at ground zero of the ZE, or zero-emission, vehicle future.

A 19-year-old actress living in Santa Monica, Calif. (she played Pocahontas in the 2005 movie The New World), Q’Orianka (pronounced Quor-ee-anka) is on her second hydrogen-fuel-cell car, a Honda FCX Clarity, a four-door with a 200-mile range. “I don’t think I will ever buy a gas car,” she says. “I can go everywhere I want to go with this. Plus, it’s a guy magnet.”

Auto-marketing gurus take note: the brave new world of ZE cars is here, ready or not, and please make them sexy.

“ZEs are an entirely different paradigm,” says Stephen Ellis, manager of fuel-cell-vehicle marketing for American Honda Motor Co. in Torrance, Calif. Ellis manages the rare $600-a-month leases (including free hydrogen fill-ups) for the FCX Clarity. “Knowing how to integrate these new technologies into existing lifestyles and then building new infrastructures to make it work is the trick,” says Ellis. “It took a hundred years to create the gasoline infrastructure; this will be much faster.”

There are three types of zero, or near zero, emission cars: electric plug-ins, hybrid plug-ins and hydrogen fuel cells (which create power by having oxygen and hydrogen pass over electricity-generating electrodes). But each major automaker has its own take on which advanced technology will win 10 years down the road.

Nissan, for example, is pedal-to-the-metal with pure electric cars, having skipped fuel-cell technology altogether. It considers “interim hybrid technology,” like Toyota’s successful Prius, a mere passing phase. “The market-share winner will be the one that offers affordable, mass-market, zero-emission vehicles with a zero payback period for premium technologies,” says Mark Perry, director of the product planning and strategy group for Nissan North America.

In contrast to Nissan, Honda has passed up pure electrics, preferring instead to bank on lower-cost hybrids (Civic and Insight) and hydrogen fuel cells. Ellis, however, claims no distinction should be made between “FCs” and electrics, since a fuel-cell car is basically an electric car powered by hydrogen-created electricity.

Then there is Toyota, the 800-pound hybrid gorilla. Toyota has yet a third route to success: muscling up on its hybrid strength.

“We believe in not being first to market but being best to market,” says Mary Nickerson, who is in charge of advanced-vehicle marketing at Toyota Motor Sales, also in Torrance. Last year, Toyota reached the 1 million sales mark with its Prius hybrid (gas-powered with fuel-saving electric technology).

“Our strategy is to be the hybrid masters, no pure electrics, and to explore fuel-cell technology,” says Nickerson. “We feel it’s going to take a lot more than one technology to make this new market work.”

Some 21% of consumers will not consider a pure electric car because of the need to plug-in at home, according Nickerson. “We believe that 10 years out, the winners will be all new technologies, but hybrids will be the largest winner of them all.”

Then again, as Honda’s Ellis says, “It all depends on the price of gas.”

Click here to read the entire article.

(Source:  Reuters,  Motor Authority)

Audi is moving from strength to strength the world over but especially here in the U.S. where for years brand prejudices has left it playing second fiddle to the likes of BMW, Mercedes-Benz and Lexus. The four-ring brand is in the midst of a transformation, however, and is set to launch a host of exciting models over the next 12 to 18 months so grab a seat and let’s look at the rundown.

Audi today reported its U.S. sales last month rose 26% to achieve its second-best August sales ever and its best month overall since June 2008. In August 2009, Audi sold 8,057 cars and SUVscompared to 6,406 vehicles sold in August 2008.  Audi posted the strong results despite offering only modest discounts toconsumers and seeing minimal impact from the federal government’s Car Allowance Rebate System. Fewer than 10% of Audi sales for the month can be attributed to the “Cash for Clunkers” incentives that were available throughout August. Audi discounts have ranked among the lowest in the luxury vehicle segment, according to third-party measurements. August was no exception to that trend.

“With each passing month it is clear that Audi is shaping the luxury vehicle conversation,” said Johan de Nysschen, President, Audi of America. “These August results are not figments of steep discounting or other sales gimmicks. They represent the reality that the performance orientation, the leading-edge styling, the attention to detail and efficiency found across the Audi lineup resonate with the priorities set by today’s luxury car buyers.”

August 2009 set a sales record for the Audi Q5 crossover vehicle, which has been met with positive critical reviews since its launch in February. For the month, Audi dealers sold 1,496 Q5 models, leaving a 21-days supply of unsold models. Typically, a 60-days supply of unsold models is considered normal.  Strong demand also tightened inventories of the Audi Q7 TDI(R) as American consumers are showing a new appreciation for the efficiency and emissions benefits of the world’s cleanest diesel technology. The inventory of unsold Q7 TDI models dipped to a mere 29-days supply.

During August 2009, Audi sold 6,167 cars and 1,890 SUVs. From January through August 2009, Audi sold 39,380 cars and 12,929 SUVs.   Audi is also optimistic about sales in the months ahead. At the end of August, dealership showroom traffic was up more than 20% from a year earlier and Internet leads were up 38.1% year-to-date from 2008 levels. What’s more, luxury consumer interest in the Audi lineup should intensify with the arrival of the Audi S4 Sedan, the S5 Cabriolet, the A5 Cabriolet and the redesigned Q7 models. Before the end of 2009, Audi will launch the new A3 TDI model, which gets a stunning 42 mpg of clean diesel fuel, according to the U.S. Environmental Protection Agency.  Audi recorded 2,642 Certified Pre-Owned (CPO) units sold in August, and has now achieved 21,187 CPO sales in 2009.

If this is not enough, Audi is upping the ante by introducing new models to beef up the market stake.  By the end of the year we should be seeing Audi’s awesome R8 V-10 supercar hitting the streets, as well as the S5 Convertible and S4 Sedan. However, the real action starts next year as Audi is planning to unveil a replacement for its A8 flagship sedan, the production version of its A7 four-door coupe and possibly the next-generation A6.

First comes the 2011 Audi A8. Speculation had put the world debut for the new aluminum space-frame sedan sometime this fall, but it’s now certain that the A8 will make its world debut at the 2010 Detroit auto show. The car will be “the first of a new styling language at Audi,” executives say. All-wheel drive will be teamed with dual-clutch transmissions and a range of diesel, turbocharged V-6, V-8 and possibly hybrid V-8 engines.

Next in Audi’s busy year will be the production version of the A7 concept, shown earlier this year in Detroit and expected at the 2010 Geneva auto show. The new vehicle is a four-door coupe based on the A8 architecture, and will share its aluminum space frame. The same powertrains from the A8 should cross over into the A7, while an S7 version may sport a V-10 sourced from Lamborghini.

Click here to read the entire article.

(Sources: Seattle PI via Autobloggreen)

With more and more electric car makers ready to blitz the market with Plug-in Hybrids Electric Vehicles and Plug-In Electric Vehicles, it is time the local communities took a stock of the supporting infrastructure necessary for feed these voltage-hungry vehicles.  The Seattle PI takes a look at the readiness of Seattle to handle the surge of electric vehicle.   Here are some interesting excerpts from the article:

Is Seattle charged for electric cars? Local electric car boosters think so, event though electric cars — other than such hybrids as the Prius — have not captured the fancies of more than a few people in the past 20 years.

“There’s a perfect storm this time around,” said Steve Lough, president of the Seattle chapter of the Electric Vehicle Association, who drives a 2000 Honda insight gas-and-electric hybrid.

On Aug. 5, the federal government announced that it will provide almost $100 million to install roughly 2,500 electric vehicle chargers each in the greater metropolitan areas of Seattle, Phoenix, Nashville, Portland and San Diego.

Roughly $20 million will go to Seattle for 2,550 chargers, Read said.

About 40 firms, including Nissan and eTec, will match the federal appropriations. Local governments will not be required to provide matching money, Read said.

This experiment is timed with Nissan’s planning to sell a new electric car — the “LEAF” — in late 2010. It hopes to initially sell 5,000 cars evenly split among the five metro areas.

This timing roughly coincides with General Motors’ plans to put possibly 10,000 of its all-electric “Volt” cars on the market in late 2010.

By comparison, Seattle has the nation’s largest chapter of the Electric Vehicle Association — with 230 members.

Local owners said recharging electric cars lead to different habits from refueling conventional vehicles.

“You basically plug it in whenever you park it,” said Dan Davids, owner of a 2002 Toyota RAV4-EV and president of the nationwide Plug-In America organization.

Fulling charging a car with a conventional 220-volt installation could take four to eight hours. So-called “fast” chargers with extra oomph could take 15 to 30 minutes to do the same.

But local electric car owners said those figures are misleading.

These cars rarely need full charges with the accompanying long repowering times, they said.

Electric cars are usually charged nightly at their homes. If recharged at business locations, the new power mostly “tops off” a battery usually containing most of its original charge, they said. The same “topping off” would occur when cars would be recharged at businesses.

Between the small amounts of electricity and the lack of wear-and-tear on moving engine parts, they estimated it costs about 2 cents a mile to operate their vehicles.

The three are optimistic that a major hurdle to owning electric cars could be finally conquered — the initial price tag. The Tesla Roadster — with about 700 sold so far — goes for $109,000. Many models of electric cars have been in the $50,000 to $100,000-plus range. “You’re financing the research and development for the next generation of technology,” Morrison said.

The Volt’s expected price tag is about $40,000 with a federal tax credit of $7,500 earmarked for early buyers. The same tax credits will go to buyers of the first LEAFs, which are expected to go for $25,000 to $33,000.

Click here to read the entire article.

(Source: NAVTEQ via Autoblog)

According to a new study, GPS-systems with real-time traffic info can save American drivers four days a year of being stuck in grizzly traffic snarls. As promising as it sounds, this particular study should be viewed with a little bit of skepticism because it was sponsored by navigation systems data-provider NAVTEQ.  Here are some of the study details (as published in the NavTeq press release).

The results are from a three pronged studies conducted in two metropolitan areas of Germany – Dusseldorf and Munich — which evaluated drivers without a navigation system, drivers with a navigation system, and drivers with a navigation system that included real-time traffic. Previous studies in this field focused more on “getting lost” scenarios versus the benefits to drivers of navigation system use during the course of their normal driving habits.

The study revealed that the drivers using traffic enabled navigation devices experienced dramatic time savings, spending 18% less time driving on an average trip versus drivers without navigation. If applied over the course of a year, a driver who does not currently use a navigation device would save themselves 4 days of driving each year if they had a traffic-enabled navigation system. Additionally, the findings show that drivers with real-time traffic experience reductions in distance traveled as well as increase fuel efficiency which would lead to a decrease in CO2 emissions per driver of .79 metric tons, or 21% less than a driver without a navigation system.

These results not only point to the positive impact on German drivers, they can be projected to other countries as well, for example*:

• UK drivers with traffic enabled navigation would save 2.5 days per year and drop their CO2 emissions by 20%
• US drivers with traffic enabled navigation would save 4 days per year and lower their CO2 emissions by 21%

Click here to read the entire press release.

(Source: via Autoinsane)

Have you ever wondered while sitting inside your car at an automated car wash, what goes on behind the scenes to test and design a vehicle so that it doesn’t leak while your car is drenched with gallons of water?  Or have you pondered driving through that pouring rain about how to stop that annoying sound of rain drops hitting the sheetmetal roof and the windshield? Here is a glimpse into that world of designing and testing a car for its “water worthiness”, courtesy of our friends at Auto Insane.

Development on the Chevy Volt continues to progress at neck-break speed and GM has been sharing bits and pieces of the vehicle’s testing and engineering along the way. This new video caught our interest for the sheer fact that it combines the “electric” Volt undergoing leak testing in GM’s Universal Water Chamber.

(Source:  Green Car Advisor – Edmunds.com)

The treehuggers have a new reason to rejoice.  For the environmentally conscious, green movement there is a new addition to spread the green gospel – this time with a sassy/sexy twist.  Hello everyone, Meet the “Angry Green Girl” the new pro-environment angel (sans wings) who was recently captured marketing a carwash product. Now after watching the video below, do let me know if you regret not having a Prius or something green to drive around.   For the ladies, if you are an aspiring “green angel” or feel inspired after watching the video below you may want to get some tips from the AGG here on how to be green and sexy at the same time.

She is  not just”Angry,” who also goes by the name Sofia Pernas (an aspiring actress, in case you were wondering), is the face of anew social networking site built around a sassy, silly and somewhat sexy crew whose members demonstrate green products, provide grammar school-level explanations of concepts such as global warming and generally – with sarcasm, satire and, somewhere in there, a little bit of seriousness – urge people to get greener.

What drew our attention – it certainly wasn’t the bikinis! – was the AGG crew’s use, during a promo for the new site staged in Hollywood earlier this week, of a product we’ve tried, and liked.

A quintet of bikini-clad car-washers (in green bikinis, what else) used a waterless wash product called Lucky Earth to scrub hybrids and other green cars for free for a few hours – sufficient time to get them at least two segments on one of L.A.’s independent TV station’s news broadcasts.

(The videos also show those of you who don’t live here how incredibly inane some of our L.A. “newscasters” can be.)

Lucky Earth is the brainchild of an L.A. couple who developed it in response to their daughter’s sensitivity to chemicals.

Click here to continue reading the rest of the article.

TransportGooru.com:  Who are these insanely annoying (or annoyingly insane) TV news people?  Looks like they primarily operate under the assumption that a woman who is good looking can never be smart enough to use big words.   Their mockery of AGG’s use of words such as “exacerbate” and “ubiquitous” validates my fear that these boneheads stereotype people at every opportunity they get.  Maybe the women in their lives (mom, sisters, girlfriends, etc) were all beautiful but dumb, driving these idiots to arrive at a conclusion that a girl can only be beautiful and dumb or ugly but brainy.  The biggest bonehead in that crew is that lady who was laughing along when the mocking  voice made fun of “ubiqutious.” MORONS!

(Sources contributing to this hybrid report: Green Car Congress; Fast Lane – Sec. LaHood’s Blog; Autoblog; Detroit News; LA Times; Business Week)

Finally, the curtains came down on the Cash For Clunkers program on Monday @8PM.  After much hype and chaos the program closed its doors with a mixed record.  Secretary LaHood calls is a great success while some others say no pointing to the choas around the program’s final days when the computer systems crashed as the dealers tried to submit their transcation data for reimbursements. In anycase, the program has left a wonderful memory in the minds of many economists and possibly underlined the fact that indeed the Government has some clever tricks up the sleeves to stimulate a lagging economy, especially for the automakers whose future looked very gloomy before this program came in to place.

After one month, an extra $2 billion in funding and an absolute mess of paperwork, Cash for Clunkers has finally petered out. The final numbers are in and the program resulted in 700,000 sales totaling $2.877 billion in $3,500 and $4,500 vouchers handed out at dealerships across the nation. An additional $100 million was set aside for administration costs, or about $144 for every claim processed, leaving $23 million in the kitty.

The program offered consumers rebates of $3,500 or $4,500 off the price of a new vehicle in return for trading in their older, less fuel-efficient vehicles to be scrapped. The trade-in vehicles needed to get 18 miles per gallon or less.

Here are some interesting snippets collected from various sources around the web (thank me for making it easy for you).

• The US Cash for Clunkers program (CARS) ended Tuesday night with 690,114 dealer transaction submitted worth $2,877.9 million.
• Eighty-four percent of consumers traded in trucks and 59% purchased passenger cars.
• The average fuel economy of the vehicles traded in was 15.8 mpg and the average fuel economy of vehicles purchased is 24.9 mpg: a 58% improvement.
• Cars purchased under the program are, on average, 19% above the average fuel economy of all new cars currently available.

Image Courtesy: Green Car Congress

Green Car Congress notes that Toyota reaped the largest percentage of sales under the CARS program (19.4%), followed by GM (17.6%) and Ford (14.4%). Honda came in fourth at 13.0%.

The top 10 vehicles purchased under the program were:

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

Top 10 Trade-in Vehicles:

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

David Kiley at Business Week says that the annualized selling rate for the auto industry in August is expected to be about 15.5 million, thanks to C4C, according to Wall Street firm Goldman Sachs. That would be a 16% improvement year over year, and nearly a 40% increase from July.  Goldman fully expects a “pay back effect” in September following the program. The firm also expects the monthly selling rate to remain above 10 million for the rest of the year, with a final sales tally of about 10.5 million, with a tally of 12 million next year. Some other analysts have pegged next year’s selling rate at 12.5 million to 13 million.

David also observed that while the program did its job, its real contribution has been less than the hype. Cash for clunkers did spur sales. It sold 690,000 cars and many were compacts like the Ford Focus and Honda Civic. So it did accomplish the mission of scrapping some old iron and selling some more efficient cars. That said, the boost will amount to less than a 3% increase for the year. That’s hardly the windfall that Germany achieved from a similar program, which pushed sales up an average of 30% a month since March. There may also be a hangover in car sales in the U.S. Edmunds says that purchase intent is now down 11% from June, meaning that fewer people are looking at new cars. So sales could slump in the coming months. In fact, J.D. Power says that more than 70% of sales may have happened later this year even if the government hadn’t spent $3 billion on the clunker program. One other point: Toyota was the biggest beneficiary, getting 19.4% of sales, with General Motors getting 17.6% and Ford getting 14.4% of sales from the program.

David Kiley says that “Clunkers” was good policy for a number of reasons (all of which I agree wholeheartedly):

1. There is no question that the program brought many car buyers off the sidelines, and gave automakers, and dealers, a shot in the arm not only in terms of sales of the vehicles that qualified, but in vehicle sales in general as the program brought lots of new eyeballs to the entire showroom, not just the models that qualified.
2. The $3 billion had direct impact on the economy, keeping people working, increasing production and shift work at auto companies and parts makers. Unlike other pieces of economic stimulus, the money was allocated and went directly into the economy. The money isn’t sitting on a shelf waiting for building permits to make it through local bureaucracies.
3. Clunkers put a spotlight on the whole idea of trading up in fuel economy. Lots of old Explorers got swapped for Ford Focuses and Toyota Corollas. I believe U.S. public policy must move toward engineering a substantial change in transportation. There needs to be more policy that persuades people to choose their vehicles in a smarter way, to leave a smaller carbon imprint. This Clunkers bill was, perhaps, a start of a recurring series of moves that will create a more fertile atmosphere and public discussion about this.
4. Perhaps the undeniable efficiency of Clunkers will influence policy-makers and lawmakers the next time they draft a stimulus package. Economist Martin Feldstein warned us when the stimulus was being debated that it was not targeted nearly enough to consumer spending. His notion, which I agreed with, was that money should have been highly targeted to spending on specific high-impact sectors—cars, major appliances, home improvement.

The USDOT’s press realease observed that according to a preliminary analysis by the White House Council of Economic Advisers, the CARS program will (1) Boost economic growth in the third quarter of 2009 by 0.3-0.4 percentage points at an annual rate thanks to increased auto sales in July and August. (2) Will sustain the increase in GDP in the fourth quarter because of increased auto production to replace depleted inventories. (3) Will create or save 42,000 jobs in the second half of 2009. Those jobs are expected to remain well after the program’s close.

Sec. LaHood says “This is a win for the economy, a win for the environment and a win for American consumers”.  He noted in his blog “CARS’ economic success has been some of the most heartening news. Both Ford and General Motors haveannounced production increases for their third and fourth quarters due to heightened demand for fuel-efficient vehicles. Honda is also increasing production at its U.S. plants in East Liberty and Marysville, Ohio and in Lincoln, Alabama.  The program has been a lifeline to auto manufacturers and dealers to be sure. But it’s also had a visible ripple effect through communities and related industries. Because of CARS, scrapyards are selling clunker waterpumps, batteries and other parts. Credit unions and banks are processing thousands of car loans. Repairmen, mechanics and sales staff are picking up additional work. CARS has truly been a winning deal for everyone. ”   The USDOT’s press release also offered the following statistics:

Vehicles Purchased by Category

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

Vehicle Trade-in by Category

• Passenger Cars: 109,380
• Category 1 Truck: 450,778
• Category 2 Truck: 116,909
• Category 3 Truck: 8,134

84% of trade-ins under the program are trucks, and 59% of new vehicles purchased are cars. The program worked far better than anyone anticipated at moving consumers out of old, dirty trucks and SUVs and into new more fuel-efficient cars.

Average Fuel Economy

• New vehicles Mileage: 24.9 MPG
• Trade-in Mileage: 15.8 MPG
• Overall increase: 9.2 MPG, or a 58% improvement

Cars purchased under the program are, on average, 19% above the average fuel economy of all new cars currently available, and 59% above the average fuel economy of cars that were traded in. This means the program raised the average fuel economy of the fleet, while getting the dirtiest and most polluting vehicles off the road.

Image Courtesy: Green Car Congress

Industry experts are now saying that after the ‘party’ of the Cash for Clunkers scheme, the auto industry will now experience a ‘hangover’, with a large drop in sales due to the lack of incentives. Auto research firm Edmunds.com predicted Wednesday that the industry “is likely to experience a painful hangover” after the monthlong cash-for-clunkers party. “People rushed into purchases that many would otherwise have made later this year. The result will be lower sales in the weeks to come,” said Edmunds Chief Executive Jeremy Anwyl.  The number of people who intend to buy a new car in the next two months was down 50% from the peak of the clunkers program and 11% from the average in June, the firm said.

Figures released Wednesday showed that California auto dealers requested the most in reimbursements, $326.8 million, followed by those in Texas, New York and Illinois.  Timely payment to dealers, some of whom are owed more than $3 million, will be a key measure of the program’s effectiveness, industry spokesman Wood said.  Michigan ended up with $132.4 million in vouchers sought under the cash for clunkers program, the eighth highest among states. California was first at $327 million followed by Texas, New York, Florida Illinois, Pennsylvania and Ohio.