Winter is coming. Like any true Seattle suburbanite, I dread the debut of the white stuff. We’re so scared of snow up here that the local insurance company even aired commercials teasing us about it. (Read More…)
The predominant critique of the cash-for-clunkers programs that have proven so popular in the US and Europe is that they cause unsustainable demand bubbles which cause sales to collapse after they expire. Sure enough, a look at the German market’s Q1 performance shows that the OEMs who most benefited from the program (primarily firms who focus on low-cost cars) are seeing far more significant declines than US-market firms have seen. In the first three months of this year, firms like Hyundai (-40%), Fiat (-58%), Suzuki (-54.6%) and Kia (-49.4%) have been suffering mightily from a hangover caused by the world’s most generous cash-for-clunker program. But the big news isn’t this small-car bust: it’s the fact that these firms’ success last year have caused the percentage of cars on German roads with electronic stability programs (ESP/ESC) to fall.