Posted on 04/20/2020 9:54:28 AM PDT by SunkenCiv
Adam Jonas covers the auto industry for Morgan Stanley. Barron's spoke with Jonas recently about how the car industry can survive the shutdown, and how it might be left changed. His edited comments follow...
We don't think the [car makers] are going to fail the way some did back in 2008 and 2009. But the industry is going to need support. We expect a cash for clunkers program to be much larger in scope and longer in duration than what we saw. In 2008 and 2009, we saw a $3 billion package that stimulated about $14 billion of purchases...
These are numbers more for discussion: a $5,000 coupon to scrap a car subject to a variety of criteria, including U.S. local content percentages, call it 60% U.S. content. So there's an American domestic angle that will of course include Japanese and Korean cars produced in the U.S. There may be some household income limitations and then limitations on the kind of vehicle you can scrap, and then how much you can buy. It might have a $60,000 maximum price limitation. It's going to be designed, we think, to support lower and middle income classes to get bipartisan support.
Also, there will be a fuel economy and a sustainability angle to it. The fuel economy of the car bought, we suspect, will be 50% better than the fuel economy of the car scrapped. By getting rid of those old clunkers, you're getting rid of the least efficient cars on the road, too. And then there's a safety element to it -- some level of minimum driving assistance technology -- so the car you're scrapping versus the car you're buying has a lifesaving element to it, which would get some support...
(Excerpt) Read more at barrons.com ...
Partisan Media Shills update.
Gasoline prices are ridiculously low, so of course .gov would want fuel economy.
lol
I don’t want anything newer than about 2009 because of all the ridiculous government mandated crap on the cars after that.
At this rate just buy every American family a car and call it a day... eyeroll...
I have 3 cars pre-2009, just the way I like it. I was thinking of selling one to CA for their own program for $1000 but you have to time it twice a year until they run out of money. But for 5K as planned, sounds too good to be true.
They tried this in CA.
When they got the tax bill for that 5k the next year, reality hit.
The last time they did “Cash For Clunkers”, the used car market almost went under.
I have a car that would be a perfect candidate. Unfortunately it belongs to my neighbor, and I’d get caught.
So those Americans that maintain a fairly newer, reliable, more fuel efficient vehicle will get screwed again. Imagine that.
Pfffttttt! My 2012 Ram hemi is currently getting about 3 weeks to the gallon. And, Mrs rktman’s 2007 volvo S80 V8 is getting even more than that. So, with any luck, we won’t ever be buying another vehicle. Are there cars I’d like to have? Yeah. But, practicality wins out on this one. Then again, which of us ever thought we’d be in the state we’re in right now? :-)
I now “Build” my own cars from parts of older production cars.
No OBD, no F.I., no anti-lock brakes, no satellite location, no cup holders!
The new cars are detestable appliances on wheels, I will not have any newer than about 1980.
The time it was done, the used market got tight and prices went up because what would have been on the market had to be chopped up. My old barber (he retired, alas) went to the dealer to trade up on his used small SUV and with the summer rebates they were offering, buying new instead (even without the clunkers money, which he wasn't eligible for) saved him about five grand.
No new cars for us. We have concluded that our car with 220K miles will serve us better than a new one that will fall apart right after the warranty expires.
We plan to repair and restore everything.
Btw, this works well for appliances, too.
Having the top end vehicle cost at $60 just about *screams* "we want you to buy a Tesla!" Instead of that, there should be a (complicated gov't-style) formula with some kind of weighting to fuel economy and vehicle cost, which would skew toward conventionally engined vehicles which get good fuel economy.
I have a 2011 Toyota. I normally get a new car every 14 years. Toyota’s are the best made cars.
Ruin the affordable used car market for high schooler parents, high school grads, college students, low income workers and retirees.
Again.
Karma, please visit Democrat politicians real soon.
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