I’m afraid our friends over at Gasgoo need a little parental oversight. Or the good folks at China’s premiere auto business site shouldn’t been drinking while posting. Today, they report that the Chinese government invested 5 billion yuan ($736m) in the “cash for clunkers” program last year. As of May 31, only 1.7 billion yuan ($250m) were handed out, with 3.3 billon yuan ($486m) left. No surprise to us. We never thought much of the program. In January, we said: “Due to the relatively young fleet in China, the impact of the cash for clunkers program on sales is expected to be small.” So far so good.
Now for a huge leap of logic:
“Therefore, the country’s automobile consumption in the next seven months will certainly be doubled,” say our friends at Gasgoo.
Shenme? (Say what????)
They really mean it. Says Gasgoo:
“China’s new vehicle consumption has achieved 15 billion yuan ($2.2 billion) since the “cash for clunkers ” program started on June 1, 2009. After China’s Ministry of Commerce (MOC) recently extended the program to December 31, the figure is expected to grow to at least 30 billion yuan by the end of this year, Luo Lei, Deputy Secretary-General of China Automobile Dealers Association said recently.”
Here’s hoping that they are thoroughly confused, and that regular reporting will resume tomorrow after the hangover is behind them.