Clunkers crush auto auction business in Danville

By Karen Blackledge
The Daily Item

DANVILLE — Wednesday marked the end of the oldest auto auction business in Pennsylvania, as the Danville Auto Auction closed, a casualty of a brutal used-car market decimated by the federal government’s Cash for Clunkers program.
Auction owner Robert “Bob” Welcomer said the auction’s business name has been acquired by a competitor, Central Pennsylvania Auto Auction in Lock Haven, but the Danville business will be shuttered under the terms of the transaction. Four full-time workers and as many as 35 part-time workers will lose their jobs.

Welcomer said there simply was not enough business for the two competing auctions to survive.

At the peak of its business, the Danville auction sold 300 vehicles during the once-a-week sale. On Wednesday, only about half that many vehicles went on the block.

The auctions have been hurt by a double-whammy. The economy has driven many used-car lots out of business, which eliminated many of their customers, and Cash for Clunkers took many of the vehicles that might have been sold in auctions off the market.

This is another example of how government intervention can distort the economy... picking winners and losers. Presumably to offset the lost jobs at this auction, there might be jobs retained at machine shops and other service providers to the new car industry... jobs that would have been lost if there hadn't been a massive government intervention. This is kind of emblematic of the law of unintended consequences.

Full Story: The Daily Item, Sunbury, PA - Clunkers crush auto auction business in Danville