Cash for Clunkers is ending on Monday. The plan was so popular that it is running out of money again and there seems to be no extension of the program.

In theory this sounded like a great plan and has definitely stimulated the car industry because people were interested in purchasing a new car that would be more fuel efficient. One problem I had with the program is that people were allowed to buy any car, instead of just offering the program for more fuel efficient American made cars. Another issue, is will the people who are buying the new cars really be able to afford the car?

When the program ends will people still be as eager to buy a new car?

“The effectivenessof the ‘cash-for-clunkers’ program will be judged in a number of ways, but a key measure will be how does the automotive market respond to the absence of the ‘clunkers’ incentive to buy now?” said Jack Nerad, editorial director at auto pricing trackers Kelley Blue Book, in a statement.

The Cash for Clunkers program is similar to loss leaders for general merchandise stores. When there are no sales or incentives for consumers to buy anything will they still want to buy items? Temporarily, car manufacturers needed to go ahead and make more cars but will this resurgence make a big difference in a few weeks or month when the incentive is not available?