Posted by guest blogger NickS.
Chrysler, Ford and GM are whining about needing a loan of about 50 BILLION DOLLARS.
What they really need are customers. If we lend them some money, they will build cars. What problem does that solve?
According to the US Bureau of Transit Statistics for 2006 there are 250,851,833 registered passenger vehicles in the US. Out of these roughly 251 million vehicles,
135,399,945 - classified as cars,
99,124,775 - "Other 2 axle, 4 tire vehicles" (SUV & pick-ups)
6,649,337 - vehicles w/ 2 axles & 6 tires
2,169,670 - "Truck, combination"
6,686,147 - motorcycles.
In the year 2001, the National Automobile Dealers Association conducted a study revealing the average age of vehicles in operation in the US
38.3% were older than ten years,(96,133,000 units)
22.3% were between seven and ten years old,
25.8% were between three and six years old,
13.5% were less than two years old. (Data from here)
Using these numbers as a starting point….
Lets take $30 billion (of the 50) and buy back cars from private owners that are over 10 years old at a rate of $5,000 per car. That would allow us to remove about 6 million old cars from the system. Some of the remaining 20 billion would be used to recycle, and crush those jalopies.
Purchase would be by application. Once the deadline for application passed we would buy cars starting with the oldest first until the 30 billion was gone.
The $5,000 would be a gift certificate to one of the big three US automakers, and Harley Davidson. We gotta show them some love too.
Its as good as cash on the purchase of a NEW vehicle.
You could sell it for some amount of the face value
You could give it to your kids
Ultimately it would create customers. Which leads to production. Which leads to jobs.
Wadda you think? They are gonna print more money anyway, why not let us spend it. In the mean time we remove some high emission vehicles from the mix.