Cash for Clunkers clobbered used car industry
The used car industry is taking big hit, economists say, because of the success of the federal Cash for Clunkers program.
Some used car lots across Long Island and across the country are either closing down or seeing sales drop dramatically.
The Cash for Clunkers trade-in incentive program had millions rushing to buy new cars and trade in their old ones. The trade-ins were destroyed though, taking a lot of used cars out of the market. The low supply drove demand up and therefore prices went up.
Economists say the situation won?t get better any time soon.
Dealers say supply is also low because car rental companies are holding on to their fleets longer instead of selling them at auctions when they?re done.