Honda, Nissan in Doubt over CARS Potential

Rolled out on Monday, the Cash for Clunkers scheme is already posting very high sales, with more than 10,000 cars sold in the first days of availability. But some automakers, and count here Japanese companies, believe scrapping bonus won't bring such a major boost in demand as the government expects. Both Nissan and Honda expressed their doubts when it comes to the programme and confirmed their low expectations to see a major growth in the United States.

"I'm not very optimistic about the US market. We're already into July and I had thought it would have recovered more by now," Koichi Kondo, executive vice-president of Honda, was quoted as saying by the Financial Times. "We had been hoping for something on a larger scale. We don't have big expectations," Toshiyuki Shiga, Nissan's chief operating officer, added.

Still, there are companies who are pleased to see the US government rolling out a scrapping programme similar to the ones in Europe. Kia for example applauded the government efforts and rushed to announced that consumers can choose from up to 11 models across its range who qualify for CARS.

“Consumers have the opportunity to not only purchase a new car with a significant rebate, but also reap the benefits of modernized safety features, advanced technology as well as increased fuel economy,” said Tom Loveless, vice president of sales, KMA.

Chrysler is even offering an extra bonus of up to $4,500 for consumers who agree to trade-in their old car for buying a model produced by the recently emerged from bankruptcy automaker.

“The administration’s program is aimed at getting less fuel-efficient vehicles off the road, and for vehicles that meet the requirements, offers a great incentive to do so,” Steven Beahm, Vice President – Sales Operations, Chrysler Group said. “But we didn’t want consumers without qualifying vehicles to feel left out so we are offering up to $4,500 to everyone.”