In ‘cash for clunkers,’ who bought American cars?
Choosing a car to buy can be complicated. For most people, it’s about more than transportation. It also has to do with personal tastes and reflects ideas about the auto industry. One key decision: foreign or American? Patchwork Nation looked at data from the federal government about which kinds of cars were purchased in the “cash for clunkers” program. We found a direct correlation between where people live and how likely they were to buy a foreign car. Earlier this week, we looked at where the program’s $3 billion went – largely to wealthier places. Now, our analysis also finds that these locales were the ones most interested in buying foreign. And it wasn’t just about money. You are what you drive? Foreign luxury cars were popular in the largely suburban “Monied ’Burbs” and in the growing and diversifying “Boom Towns.” Both of these community types have median household incomes above the national average. About half of the Acuras, Audis, BMWs, and Mercedes-Benzes sold as part of the program were sold in those two community types. Add in the big-city “Industrial Metropolis” counties, which hold a lot of wealthy people, and that fraction increases to about three-quarters. This is no shocker. Wealthy people often buy expensive cars. But people in those same communities could have bought higher-end American cars – Buicks, Cadillacs, and Lincolns. Many chose not to. In those three community types, people bought 2,500 Acuras, Audis, and BMWs, and only 1,110 Buicks, Cadillacs, and Lincolns. Looking at a fuller range of car options, we found that these three community types bought far more Toyotas and Hondas than they did Chevys, Pontiacs, Fords, and Chryslers. On the whole, the “Industrial Metropolis,” “Monied ’Burbs,” and “Boom Towns” were less interested in buying American cars than the other community types were. American autos accounted for 28 percent, 32 percent, and 31 percent of the purchases, respectively. The places that were keenest on American cars during the clunkers program were rural, agricultural “Tractor Country” (69 percent American); the graying “Emptying Nests” (57 percent); the socially conservative “Evangelical Epicenters” (46 percent); and the small-town “Service Worker Centers” (46 percent). These places may have opted for American autos because fewer foreign-car dealerships are near them. Or maybe cultural preferences came into play. Regardless, those places sent the money and car orders back to Detroit. Those places also received much less of the total $3 billion – less than $500 million. Who was helped? Then again, the definition of an “American car” is not so simple in 2009. In a press release on the cash-for-clunkers program, the Transportation Department emphasized that models “made in America” topped the bestsellers list, “from the Ford Focus to the Toyota Corolla to the Honda Civic.” The Civic is manufactured in Greensburg, Ind. The Corolla is made in Fremont, Calif., although that plant is set to be closed in 2010. Still, here is one conclusion from the data. Only new cars could be purchased in the clunkers program, and that tended to steer more money to wealthy communities. It also led more of the money to be spent on foreign cars. Making used cars eligible might have allowed for more spending in less-wealthy places – places that tend to buy more American cars. That might have put more money into the hands of used-car dealers and into those communities – and might have put more fuel-efficient cars on the road.