Impact of 2009 Cash for Clunkers program on US vehicle stock

The 2009 Cash for Clunkers program, implemented under the Consumer Assistance to Recycle and Save Act, resulted in the destruction of approximately 680,000 functioning vehicles. The $2.85 billion initiative offered motorists $3,500 or $4,500 toward fuel-efficient models in exchange for surrendering older cars, trucks, and SUVs.

Reports indicate that about 85% of the surrendered vehicles were trucks, SUVs, or light trucks that were often still operational. To comply with the program, dealerships were required to disable engines before the vehicles were crushed or shredded, preventing them from being resold as affordable transportation.

This historical removal of inventory is being linked to current scarcity in the used-vehicle market. Recent data from Cox Automotive shows that cars priced below $15,000 accounted for only 15.7% of used-vehicle dealership inventory in September, down from 19.4% the previous year. The average used-vehicle listing price reached $27,235 in September, marking its highest level since December 2022.