No More Cash for Clunkers?


As reported by HotAir via Politico, it looks like Obama’s Cash-for-Clunkers program, which was planned  to expire at the end of October, will be clunking its last very soon, possibly as soon as midnight tonight. That’s right, it took less than a week for the program to rip through one billion dollars. How much of that money went to actual rebates and how much was overhead, is still unknown.

This is bad news for consumers, certainly. The program at least was able to generate enthusiasm in new car buyers, and incent them right into the doors of dealerships. This doesn’t take into account the problems many dealers are having navigating the government red tape in order to get the green of the rebates. It also happens to be bad news for other industries.

As someone who has worked for more than two decades in the advertising industry, my first thought when I heard that there was to be no more cash for clunkers was not about the consumers who won’t be able to take advantage of U.S. taxpayers’ generosity, nor about the cars that won’t be sold by the dealers. No.

My first thought was that the car companies and the dealers have sunk millions, possibly hundreds of millions of dollars into advertising; into getting people to walk into a dealership and even just ask about Cash for Clunkers. These campaigns in many cases are likely scheduled to run throughout the rest of the summer and into the fall, when it was expected that the program would end.

Now, not only are they out the money they spent on these dead aborning campaigns, but they also have to scramble with their agencies to get replacement ads in place. Time has already been purchased and scheduled on television and radio; space has been reserved for magazines and newspapers; algorithms have been calculated to get the most bang for the dealers’ bucks  for key words in search engines; online ads, pop-ups, point-of purchase, sports venues, endorsements, and on and on. The mind just reels when you think of all the planning, the creativity, the sweat…

Please don’t think I’m arguing that advertising is deathless prose or high art. I’m not. It’s advertising. But there is a lot that goes into planning, creating and placing those ads you see on TV, in the paper, and online. It involves dealers, agencies, studios, artists, meetings, ideas, and money, money, and more money. Money that dealers don’t have to spare, money that the automakers definitely don’t have to spare, and now, money that ad agencies don’t have, period.

The Law of Unintended Consequences is a powerful force; you ignore it at your peril. The Obama administration’s disregard for that law will hurt the consumers, the dealers, the auto makers, the ad agencies, and ultimately the administration itself.

UPDATE: Michelle Malkin reports that advertisers haven’t pulled any ads… yet. Could the program be resurrected? If so, it will still affect dealers, auto makers and ad agencies if there are any changes to the program — same amount of cash offered? Same list of clunkers? Same requirements? Same fine print. Regardless, there’s a lot of money being wasted because of this.



4 Responses to No More Cash for Clunkers?

  1. trickshottravis says:

    Its on I think there will be more funding coming.

    • Stoutcat says:

      TrickshotTravis: you’re probably right, but will it be the same, or will everyone have to do crash-priority changes to their ad campaigns because the terms have changed, the cash amount has changed, the trade-in requirements have changed… you get my drift.

  2. […] company. The problem is that the Illinois company admits it can’t actually build any blimps. No More Cash for Clunkers? – 07/31/2009 As reported by HotAir via Politico , it looks like Obama’s […]

  3. Marsha says:

    More jobs for Collection agencies and Repo- men and DFS.
    New car Higher insurance Premiums not to mention a monthly car payment. Family must get food stamps to eat or they cannot afford the new car so repo man takes car
    Stimulus program in action

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