Car crash - Business Week: "
After the clunker party, an auto sales hangover." Car sales soared in August by borrowing from sales for the rest of 2009. Also, can you guess which motor company most benefitted from the C4C program? It was good ol' Mom and apple pie Hyundai.
6 comments:
By that premise, all discounts are stupid. And any retailer who uses one is cutting his own throat, because there's no conceivable advantage to it.
From the Business Week article:
"GM's 20% decline was partly due to a rough comparison with August 2008; that year-earlier month marked GM's 100th anniversary and the company offered employee pricing and a truck-blowout sale"
Truck blowout? Didn't those crazy men understand that they were borrowing from sales for the rest of 2008???
It's too bad about Hyundai's Clunker success hurting American business. If we're playing guessing games, any estimates on how many people flew to Seoul dealerships to buy their new car?
BTW, Hyundai *didn't* benefit the most - they had one of the largest percentage increases, as compared to August '08 totals. GM, Toyota, Ford, American Honda, and Nissan all sold more physical vehicles last month, in that order. All but Nissan sold *many* more. GM's sales were about 250% of Hyundai's. Hyundai sold the 6th-most cars in August 2009, just behind Nissan and just ahead of Chrysler.
Where to begin?
Discounts aren't stupid. But the decision to accept smaller profits are normally a company's decision alone; government intervention in C4C distorts the capitalist model. But then again we helped out Chrysler and they're OK now, right? Right?
As for GM, do a search on GM's goal to reach 29% market share. It's heartbreaking in their pursuit of short-term goals at the expense of long-term solvency.
Oh that Hyundai line is clever. I'll bet Americans filled up at American gas stations, too. The dealer markup dwarfs the profit to the actual manufacturer, right?
Finally, I don't get your point on Hyundai. GM is a much bigger company, so they sold more autos? Who cares? One or two companies (Hyundai & Nissan) saw much greater growth because they were more popular. Focusing on total autos is just clinging to a model that will eventually fade.
Where to retort? "Government intervention distorts the capitalist model"? Sure you want to stick with that one, after the last few years?
Despite that intervention, the Cash for Clunkers program was voluntary, for both consumer and dealer.
August's average asking/selling prices were reportedly higher, also.
That some consumers prefer Hyundai's products to GM's is a marketing & design issue. It has nothing to do with the Clunker program's successes and failures - imagine that GM's and Hyundai's numbers were switched, and the program would still be the same.
Again, GM outsold Hyundai 5:2 last month, despite consumers' future concerns about GM parts, service, etc. Yes, GM's bigger, but Hyundai and Nissan saw "much greater growth" because they sold fewer cars a year ago. Who cares? Statistics care. Smaller samples allow for more volatility in percentage growth. And if it's all about the percentage, then the % hit Hyundai's about to take in September 2009 might just kill them.
It's a little late in the day for those who generally support the "conservative free market" model to complain about how many foreign countries divvy up gas station and car dealership profits in 2009. When your party's standard-bearers don't give a crap about "good ol' Mom and apple pie" - and they don't - then you're a chump to use Mom's pie as a partisan rooting point.
Too bad Cash for Clunkers wasn't voluntary for the taxpayer.
Well, anybody can sell a dollar for eighty cents. We'll see how the American auto companies fare after this temporary crutch is taken away. I suspect a generation from now we'll all be driving Toyotas and wondering "What is this 'General Motors' that Grandpa keeps talking about?"
Not in Vermont!
We'll be driving Schwinns--in -20° temps because the greenies think Obama is swell.
"Well, anybody can sell a dollar for eighty cents. "
That would be more valid if new cars held their value. Or if the fuel efficiency of the new cars was as low as the trade-ins'. Or if the buyers got to keep their twenty new cents, like they were holding onto their eighty old cents.
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