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Foreign cars top 'Clunkers' buy list

Toyotas at a dealership

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TEXT OF STORY

Kai Ryssdal: Some of the early sales figures from the Cash for Clunkers program are in. Think of them as a referendum on Detroit, with American carbuyers doing the voting through their purchases. To get the biggest rebate they can, a lot of customers are going for smaller, more fuel-efficient vehicles. The Ford Focus tops the list. But foreign companies dominate the Top Ten. Our senior business correspondent Bob Moon has more.


BOB MOON: Besides Ford's Focus, four foreign brands round out the top five on the government's list. They are the Toyota Corolla, Honda Civic, Toyota Prius and Toyota Camry. Which raises the question: Is that the American auto industry that Transportation Secretary Ray LaHood was talking about this week on MSNBC?

RAY LAHOOD: I don't think there's any question about it. This is the lifeline that will bring back the automobile industry in America.

Despite their mostly foreign brand names, nearly all the top-selling "clunker replacement" vehicles are built in North America.

Marc Cannon is a spokesman for the country's largest automobile retailer, AutoNation. He argues that the foreign-dominated list doesn't necessarily bode ill for America's troubled car companies.

MARC CANNON: I don't think it's a vote against Detroit. Remember, in the 1990s Detroit's market share was 70 percent; today, it hovers in the low 40s. So really what you're seeing is the buying habits of the American public today. I think when it's all said and done, the market share is going to look very much like the sales ratio did before this program.

At the consulting group CSM Worldwide, auto sales analyst George Augustaitis wonders if consumer preferences are really all that different. He says the $4500-per-vehicle incentive was targeted specifically at improving fuel economy. But general sales figures on Ford's market-leading pickup might tell a different story.

GEORGE AUGUSTAITIS: If you could have purchased a 2009, 2010 F-150 that got 18 miles to the gallon and still got your full $4500, people would have done it. That series was the Number One-selling vehicle in the month of July.

Indeed, even Transportation Secretary LaHood admitted this week where his preferences lie. He told MSNBC he has his eye on a four-wheel-drive Ford Explorer.

I'm Bob Moon for Marketplace.

About the author

Bob Moon is Marketplace’s senior business correspondent, based in Los Angeles.
jimw henry's picture
jimw henry - Aug 11, 2009

For working trucks the rule is not based on the fuel efficieny. As long as it is manufactured before 2001 they all qualify
but cannot be older than 25 years old..

Henry
Blogger
www.cashforclunkersfacts.info
http://www.cashforclunkersfacts.info

jw henry's picture
jw henry - Aug 7, 2009

Program runs through Nov 1, 2009 or when the funds are exhausted, whichever comes first.

Henry
Blogger
www.cashforclunkersfacts.info
http://www.cashforclunkersfacts.info

Andrew Somerville's picture
Andrew Somerville - Aug 6, 2009

This may seem trivial, but thank you *so* much for setting an example by using "raises the question" where others are tempted to misise "begs the question". Perhaps it's just my pet peeve, but I'm sick to death of hearing journalists misuse "begs the question" every day.

Tom goodwin's picture
Tom goodwin - Aug 6, 2009

This sems like one more example of U.S. car makers not keeping up with the times. They don't make a high quality small car but that is what we will buy. Too bad the U.S. auto industry execs have never seen the light.

Donald Plezia's picture
Donald Plezia - Aug 6, 2009

You may not know the whole story about building cars.

While the cars may be built in America, almost all of the component parts are built in the mother country and shipped here for assembly. E.G.: the power steering pumps were built by Mitsubishi in Osaka, the steering gear were built in Tokyo. the tires were built in Japan, as were the engines, radios, axels and transmissions. In fact, I'll bet that about 80 to 90% of the car was made in Japan.

In addition, the profits from the sale of these cars in America does not go to a company in Detroit but to a company in Tokyo!

So, I don't see how this stupid plan constructed by a stupid congress helps the American auto manufacturers.

I am a retired American auto executive sweating out my pension.

D. W. Plezia

James Golden's picture
James Golden - Aug 6, 2009

Why do you bury the fact that most of the "foreign" cars were built in America? The headline makes your readers believe we are spending tax money for foreign jobs. This is dishonest journalism.

jimw henry's picture
jimw henry - Aug 6, 2009

so if you have two or more clunkers at your house you cannot trade both of them for one car. The program is for one per
person.

Henry
Blogger
www.cashforclunkersfacts.info
http://www.cashforclunkersfacts.info