Unfortunately, I'm not referring to their lengthy vacations, but rather the "cash for clunkers" plan to juice car sales. Nearly one dozen European countries are hoping to spur car owners by subsidizing drivers who get rid of old cars for smaller, more fuel-efficient ones.(average subsidy, 1,000-2,500 euros)
President Obama has endorsed a similar plan--could it work here? In Europe it has exceeded expectations, leading to about 2 million cars rolling off the lots. Still, Americans favor higher-priced, larger cars when compared to the smaller, cheaper cars that the Europeans are driving. And, the plan wouldn't be enough to keep G.M. or Chrysler from bankruptcy, though it would help keep people employed (for now, at least).
France had a program in the nineties and it produced an initial bump, but was followed by a deep plunge. How can we be sure the initial positive impact would not end up back-firing in the long-run?
What do you think would getting extra money off the sticker price be enough to get you to trade in your clunker?