It’s been just over two years since the federal government’s $3 billion Car Allowance Rebate System — better known as Cash for Clunkers — took 677,081 used cars off the road, spurring an equal number of new-car sales in a recession-battered economy. Vince Powell says he can still feel its effects. Powell owns Powell Motors, an independent used-car dealership across the Willamette River from downtown Portland, Ore.
"Obviously a lot of them were junk and deserved to be called clunkers," says Powell, who owns the store his father began in 1933. But a sizable chunk — Ford Explorers and other four-wheel-drivers — were "decent cars," he says. "I think we’re paying for it now. Prices for used cars are up, and the cheaper stuff was higher now than it was before."
In the program’s aftermath, slashed supplies drove used-car prices up.