Thursday, August 6, 2009

Unintended Consequences #2

As a management consultant specializing in strategic change management, I long ago learned that a good deal of thought needs to go into anticipating the potential unintended consequences of any change that is being considered.

An article in today's Wall Street Journal (section A, page 4) entitled "Clunkers Plan Deflates Mechanics" is a prime example.

Who are the winners? Automobile Manufacturers and New Car Dealerships. You may include buyers of new cars under the program as well.

Who are the losers? The federal government (really the American Taxpayer) for sure. The CARS program is not an investment from which the government can expect a return. It is a spending program. Used car dealers? Maybe. Apparently the other losers include automobile mechanics. There is a certain logic to the argument. Taking large numbers of older cars (which are more typically serviced by independent repair shops than by dealerships) off the road could be expected to have a negative impact on those shops.

Was this consequence unforeseen? Not according to the article which indicates that the Automotive Service Association sent a letter to members of Congress in May voicing this concern and suggesting that programs that are in place in both Texas and California that provide a "repair" option be considered as part of the CARS program. Apparently, this message fell on deaf ears.

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