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“Cash for Clunkers” Sales on the Rapid Decline, Says Edmunds.com

The rush of automotive sales activity brought on by the "Cash for Clunkers" program is fading fast, according to Edmunds.com, whose latest study of car buyer behavior indicates that automotive purchase intent is down 31 percent from its peak in late July.

by Staff
August 19, 2009
2 min to read


SANTA MONICA, Calif. — The rush of automotive sales activity brought on by the "Cash for Clunkers" program is fading fast, according to Edmunds.com, whose latest study of car buyer behavior indicates that automotive purchase intent is down 31 percent from its peak in late July.

“Now that there is plenty of money in the program and the most eager shoppers have already participated, the sense of urgency is gone, and the pace of intent decline is accelerating,” observed Edmunds.com CEO Jeremy Anwyl. "Inventories are getting lean and prices are climbing, giving consumers reasons to sit back."

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Last week, activity was down 15 percent from the late July peak, and Edmunds.com analysts predict that in the coming days, purchase intent will return to levels seen before the launch of Cash for Clunkers. Purchase intent has proven to be a reliable leading indicator of sales to come in the following 90 days.

“Our research indicates that Cash for Clunkers buyers have come in three waves: the first was the informed, pent-up buyers who anxiously waited for the program to launch, while the second was the mass market who responded to advertising and other promotional coverage of the program,” recalls Edmunds.com senior analyst Jessica Caldwell. “Now the industry is largely servicing the third wave, which is generally made up of people who had to chase down copies of lost titles and other paperwork and are now able to finally participate. It is unclear where the customers will come from after this wave crests and breaks.”

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