['97ventureowner]

Originally Posted by wafrederick

Add a grand to that due to what Cash for Clunkers did, rise the price of an used car.

: Um, no, not entirely correct. Going off topic for a second to clear this issue up ( hopefully once and for all.) The CFC program had very little effect on the prices of used cars that are fairly newer and costlier. You are correct when you say the price of used cars is higher, but are placing the blame in the wrong place. The blame can mainly be placed with the faltering economy. People tend not to buy new cars during times that are lean, rather choosing used vehicles where the depreciation hit has already been taken by previous owners and prices are more attractive than their counterparts that are new. Sales of used cars has increased over the last couple of years as consumers are spending their money wisely looking for deals which many used cars afford them. That has in turn, decreased the available amount of used cars available on the market , thus raising prices. Add to that a decrease in production/sales of new cars and many people turn to used cars as an alternative. This can be expected to continue for awhile as the economy tries to recover and production/demand for new vehicles increases once again.
The segment of the market in which the CFC program possibly has had an effect is on the lower end of the used car market,( those vehicles that are over 8 years old and under $5000.) Most of the vehicles turned in to the CFC program were older, "lower valued" vehicles that mainly would be found in private ads and places like smaller used car dealers and "on the side of the road" type sales. The used SUV market for older vehicles also may be affected for a short period of time as those vehicles, including pick up trucks were turned over in large numbers as well. Many of these trucks may have never been traded in or sold , rather been driven into the ground by their current owners , but the program incentives were too great to ignore for many to go out and replace them. So those numbers may have a nil effect as they never would have been in the used vehicle market.
Besides, give it a year or two and even those prices for the lower end trades should start coming down as the next set of vehicles get traded in , especially if the economy continues to improve and the pent up demand from consumers for new vehicles gets unleashed. After every recession, auto sales improve and the result is there is an influx of used vehicles available on the market.

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