Well, folks, apparently it’s continuing on.  The problem we reported on earlier with Cash For Clunkers having the unintended consequence of drying up the used car market is getting worse.

Used cars in general are getting more scarce, and those that remain are going up in price despite the overall weakness of the economy.  But, in a bit of good news, this also means that your used car is worth more in trade if you’re looking to trade your car in for a newer model.

Car dealers express it best this way:

“Most of our sales, maybe 90 percent of it, is in the 5-year-old and older cars,” he said. “You ask me how many of those we didn’t sell – every one of those in a Cash for Clunkers deal, whatever that number is.”

Supply and demand comes back to haunt us all.

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As if you needed any more proof that the Cash for Clunkers program was a success — It was recently made known that dealers across the United States have reached their lowest inventory levels since 1975. And, while this may seem like a bad thing, this is great considering the slow auto sales caused by the recession.

However, this isn’t all peaches, considering demand is expected to shrink a hefty amount considering there are no more Cash for Clunkers incentives. Luckily though, due to the low inventory, automakers will now be able to supply dealers with an appropriate amount of vehicles to keep up with demand. So, in turn, there won’t be a ridiculous amount of cars sitting on the lots which got us into this mess in the first place.

via kickingtires

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Back in June we were met with reports of GM eyeing potential buyers for their Opel brand. Now, reports have begun circulating that GM is considering keeping the brand, but not without proper funding.

In fact, GM says they will need to raise $4.3 billion if they plan to keep Opel, something that seems unlikely to happen considering they only just came out of bankruptcy.

Of course, this doesn’t completely rule out the possibility of the automaker selling off Opel however what will actually happen remains a mystery. We’ll have to wait and find out.

via wcf

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Cash for Clunkers continues to prove itself to be nothing short of a massive success as Ford has recently announced that the will be increasing their vehicle production of 10,000 for Q3 of this year.

This is due to the fact that Ford has seen an enormous increase in sales after the Cash for Clunkers program began, particularly their Escape and Focus models which will make up for most of the increase. Furthermore, Ford has also let us know that due to the  increased success they will be increasing Q4 vehicle production 33%  every year from this year forward.

Let’s just hope automakers don’t get too optomistic over Cash for Clunkers because that’s what put us in this horrible mess after all, right?

via Jalopnik

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Mini has thought up a creative incentive to get buyers focused on their vehicles after utilizing the Cash for Clunkers program.

As you can see, if you buy a Mini with Cash for Clunkers credit you will be given a bumper sticker that says “My other car was demolished by the government.” Creative? Yes. Would I put it on my car? Probably not.

KickingTires reports that the cheapest Mini gets 28MPG in the city and 37 on the highway which means you’ll get the full $4,500 from Cash for Clunkers. I mean, you could probably sell the bumper sticker on eBay for a couple bucks in the future but will it really rake in more buyers?

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It seems that the 2010 Detroit Grand Prix will no longer happen as it was officially canceled today and isn’t scheduled to return until 2011 at the earliest.

I’m sure you can guess the reason for its cancellation if not, I’ll give you a hint: the economy.

Below Grand Prix Chairman, Bud Denker, comments on the cancellation:

“We had hoped that the economic environment would allow the Grand Prix to return to Belle Isle in 2010. Unfortunately, this continues to be a challenging time to secure sponsorship to produce a world-class sporting event… We remain committed to the future of the race and we are hopeful that the Detroit Belle Isle Grand Prix will return in the summer of 2011.”

Here’s to hoping the economy recovers sooner rather than later so that Detroit can again give the Grand Prix a home.

via Autoweek

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BMW has announced that they will be offering buyout packages to their employees despite their earlier premise of additional jobs needed at the Greer Plant. It doesn’t take a genius to note that this is in line with the growing problems of the economy but what is really contradicting is their continued expansion efforts.

There were no details of the buyout packages as of yet. Similar to the fate of most popular car brands, BMW is likewise succumbing to the economic pinch and the best they can do for now is look out for the welfare of their workers in an orderly manner.

By BMW’s estimates, about 5,000 people work at the local plant, including some contract workers may be cut due to the poor sales and rising operation expenses being incurred by the company to date.

(Source) News Observer

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It’s no secret that GM was hit extremely hard by the economy, so hard in fact that they had to put a halt on all of their leases.

That halt may soon be over as the Wall Street Journal reports that GM is gearing up to begin leasing cars again as early as next month. This would probably be a smart business decision for GM considering the economy is finally starting to stabalize (knock on wood) and the fact that leases made up 20% of GM’s revenue last year.

Further reports suggest thatGM will be looking for other financial institues to help with leasing rather than GMAC.

Read (WSJ)

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BMW has announced today that they will no longer be participating in the Forumla One circuit after this year. This decision was reportedly made before the Concorde Agreement was signed that would have tied BMW to the circuit until 2012.

BMW’s decision to withdraw was apprantly made due to the increasing finances that the circuit required. However, Autoweek suggests that the BMW team may continue under private ownership but BMW has given no official word to confirm this.

This is a sad day for Formula One and raises the question of which automaker will withdraw from the circuit next.

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For cars, there is a specific number of people who are allowed to ride in them. But in some cases, this is not being followed. Among the leading sector that are practicing this are the teenagers who are either trying to save on cost or for some joy-ride reasons. While the latter may seem a generous act, it still remains that there are laws against this.

Going back to saving on cost, it is evident to date that people are trying to buck the transportation expenses that they have to face. Similar to vehicle overcrowding, car cramming can result in hefty fines which may end up be a double whammy. Aside from the fines, the car structure and support will severely be affected.

Here are some risks of car cramming:

• Dragging – when a vehicle is overcrowded it can cause the underside to drag over speed bumps and when travelling up and down hills. This can cause damage to exhausts and brackets which can be costly to repair.
• Handling – more weight in your car than it was designed to carry can affect steering and braking which makes the car slow to respond and could lead to a nasty accident
• Headlights – excess weight can mean that headlights will appear misaligned and could cause dazzling in drivers travelling in the opposite direction

The current economy should not be an excuse. As drivers, they should know the capacity that their car can accommodate. Overlooking this can result in more expenses rather than saving if they are not careful.

(Source) Press

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This is a great example of how the economy is affecting consumer buying even among the rich. Selling properties is already on a downhill trend and from this example alone, you can see how some people are trying to sweeten the pot in the most tempting way.

Imagine selling a £300,000 mansion and then adding a Ferrari F430 for the lucky buyer? Now that is something you don’t see every day but apparently no one is biting. The Ferrari F430 alone is priced at £100,000 and yet no one is biting. So adding this as a freebie or bonus, you know the seller, Mr. Duncan Jones either wants to liquidate his assets or simply wants to get rid of some idle stuff.

The timing may be off, but today you will agree, we are seeing a lot of crazy deals and this is one of them. For now he is planning to transform the mansion into an office. It makes you wonder if the Ferrari would be a service car or be leased as well. If it does go with it, now that is really crazy!

(Source) SkyNews via Bornrich

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We got our first hint that Porsche and VW would merge into a single company back in May but ever since no deal has officially gone through. Today however, reports suggest that VW is all ready to actually buy-out Porsche effectively merging the two companies.

The deal will apparantly allow Porsche to get out of the severe debt they are currently with as VW will pay off €8 billion of their €10 billion+ debt in two stages.

If all goes well and this deal pans off, VW is looking at a 49.9% share in Porsche. Now let’s see a VW branded supercar hit the market!

via Autoblog

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It seems that the iconic motorbike maker Harley-Davidson has recently posted a 91% drop of earnings for the first half of 2009 compared to the same time period of 2008.

Despite the frightening drop, Harley CEO Keith Wandell was quoted to have said “the underlying fundamentals of the Harley-Davidson brand remain strong.”

While I have to say I agree that whenever someone sees a hog drive down they road they immediately think ‘Harley’ I don’t know if the fundamentals of the brand are strong enough to save the company from the economy.

via Jalopnik

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Due to the current state of the economy, GM was recently given the permission to put a halt to 54 sponsorships including advertising and marketing contracts in the US.

These cuts will save GM millions of dollars which will hopefully help the company regain its footing in the shakey encomoy. WorldCarFans reports that due to these budget cuts the Chevrolet Clock in Times Square that has been standing since the 1930s will be dismantled.

With all of this help from the government will it be enough to save GM? Or will it only prolong the inevitable effectively slowing the company’s death? Only time will tell.

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It seems that BMW exec, Key Seglar, was recently quoted to have said that there are no plans to bring the M7 model to market.

He then went on to say that the AWD BMW 760 has enough power to please those who are looking for an M7. This is quite the bummer considering pretty much every vehicle BMW slaps the M branding on turns out to be awesome year after year.

According to WorldCarFans, Seglar notes the prominence of the M series in the US market going on to say that out of 24,186 vehicles sold in 2008, 9,738 were sold in the US alone. Perhaps once the economy recovers we will see the M7 come to market but until then, we’ll have to be satisfied with the 760.

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