Paying Farmers In China “Cash Back” Deals To Buy Cars

Print Email

China has come up with another economic stimulus idea worthy or emulation by the US.

The central government in the world’s most populous nation will give farmers a credit if they buy new light trucks of minivans. The “cash back” deal is worth almost $1,000 for each vehicle.

The plan may actually have a windfall for GM. According to the AP, “General Motors Corp.’s mini vehicle joint venture, SAIC-GM-Wuling, which claims about a 50 percent share of the Chinese market for such vehicles, will likely be one of the biggest beneficiaries from the plan.”

With its sales down almost 45% in the US market despite huge “cash back” offers for new car buyers, there is plenty of evidence that the program in China won’t work.

Douglas A. McIntyre

RSS Facebook Twitter