Post "Cash for Clunkers" demand for autos is "disaster"

According to Chrysler (now owned by Italian automaker Fiat), sales of its cars are down 19% so far this month.

Chrysler/Fiat's CEO described this development as a "disaster" and said the auto industry would see "harsh reality" this month.

The good news? Apparently Chrysler lots cumulatively have about 1/4 of the inventory on hand compared to a year ago. Chrysler has plans to restock those lots, which presumably means more work for their factories which is good for their employees.

Nonetheless, this development supports the argument many people made: that "Cash for Clunkers" wouldn't create any new demand, it would only cause people who already had plans to buy cars to buy during the program's run thus reducing demand in the months afterward.

You can read Bloomberg's article on this piece of news here: Chrysler Executives Say U.S. Industry Sales Plunging (Update1)