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Cash-for-Clunkers-like program possible, Ford says

As the coronavirus slams the economy, Ford suggests a similar stimulus program will be necessary.

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The auto industry faces some tough months ahead.

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As the coronavirus continues to make an impact on the US, automakers are likely in for a rough patch as car buyers stay home and the economic impacts become more prevalent. Could something similar to Cash for Clunkers come about to jump-start auto sales? Ford thinks so.

Mark LaNeve, Ford's vice president of US marketing, sales and service, told Bloomberg in an interview published last week that a level of stimulus will help numerous levels of the auto industry. The automakers, dealers and car buyers could all benefit. He added Ford is currently discussing proposals internally, but the automaker expects to involve the federal government down the line. 

A Ford representative told Roadshow, "We are encouraging Congress to look at a variety of ways to drive job creation, increase demand, support customers and provide long-term stability for the entire auto ecosystem."

LaNeve told Bloomberg one model Ford continues to look at is something similar to Cash for Clunkers. The program provided $3 billion from the federal government to car buyers trading in older, less fuel-efficient vehicles for newer, more efficient models. Experts remain divided on whether the program actually boosted vehicle sales and helped the economy rebound, or if it simply crunched vehicle sales over a short period of time. The program kicked off in July 2009 and wrapped up by the end of August.

Critics maintain it simply provided incentives to those who planned on purchasing a new car regardless of the economic situation, though other evidence shows it did increase overall vehicle sales and boost the number of fuel-efficient vehicles on the road. As for auto enthusiasts, many cried foul as numerous older, desirable vehicles were sent to the scrap yard.

Automakers posting Q1 sales results showed a massive plunge as March events decimated any early positive results. Last month saw millions of Americans stay home amid state and local orders to slow the spread of COVID-19. Numerous dealerships have closed as officials suspend operations at nonessential businesses, though service departments often remain open. For those looking to navigate car buying amid the coronavirus, we have a handy guide to every automaker offering new vehicle home delivery.

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First published April 2.