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Cash for Clunkers - Does it Work for You?

Kirstie_HKirstie_H Posts: 10,830
The Savvy Shopper: Cash for Clunkers - Is it for you?

Do you have questions or comments about how this program will work? Here's the place to ask.

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Comments

  • bhill2bhill2 Posts: 1,333
    The list of clunkers given in the article starts as 1990. I am sure that this is for space reasons, but is there a limit on how old the clunker can be or how many miles it can have? I have a 1985 Mercedes 380 SE that still runs great, but has 250,000+ miles and is getting a little worn out. Would it qualify? Oh and yeah, how do I find out what the EPA gas mileage figure is on it?

    2009 BMW 335i, 2003 Corvette cnv, 2001 Jaguar XK cnv, 1985 MB 380SE (the best of the lot)

  • tidestertidester Posts: 10,110
    I don't believe there is any limit on the age of the car. The EPA estimates for the '85 380 SE are 14 mpg city, 17 mpg highway and 15 mpg combined.

    tidester, host
    SUVs and Smart Shopper
  • andre1969andre1969 Posts: 21,897
    my understanding is that the age range is 1984-2001, and for fuel economy, it has to score 18 mpg or below on the combined rating, using those new numbers they came out with in 2007.

    Fuel economy ratings are available at http://www.fueleconomy.gov. However, one thing that confuses me is 1984 model cars. As far as I know, only the raw laboratory numbers are available for them, and these numbers are much more generous than the numbers they used for 1985-2007, or the even more dumbed-down numbers they use now.

    Just doing a quick scan through those raw 1984 numbers, the only domestic cars I see that would qualify would be ex-police cars. The Gran Fury/Diplomat and Crown Vic are rated 17 combined, while the Caprice is rated 18. On the foreign front, about the only cars that would qualify as guzzlers would be exotic stuff like Ferraris, Lamborghinis, Rolls Royces, etc.
  • lemkolemko Posts: 15,144
    Wouldn't have helped me apparently. My '88 Park Ave was too fuel-efficient. Would've been nice if I could've got $4,500 towards a 2010 LaCrosse!
  • tidestertidester Posts: 10,110
    my understanding is that the age range is 1984-2001

    The bill has no specific age provisioning. The 1984 model year stipulation only has to do with how the gas mileage is figured. From 1984 onward, the official EPA gas mileage estimates are to be used while gas mileage for model years from 1978 to 1984 will be determined by "the secretary" somehow making use of EPA and NHTSA data (the formula is not prescribed). From what I can tell, "the secretary" will determine eligibility for earlier model.

    tidester, host
    SUVs and Smart Shopper
  • bhill2bhill2 Posts: 1,333
    Thank you for all who provided information on this. In fact, I found a web site, http://www.cars.gov/ that gives the information that I was requesting; both age limits and gas mileage values. It states that the car must be less than 25 years old at trade in. That makes MY 1985 cars the oldest that qualify, and those only until the end of the year.

    2009 BMW 335i, 2003 Corvette cnv, 2001 Jaguar XK cnv, 1985 MB 380SE (the best of the lot)

  • I've had my eye on this bill for a few months now, but the final language may exclude me. I am 25 and still drive the 1994 Jeep Grand Cherokee that I learned to drive in when I was 16. It was registered and titled in my parents name for all those years, even though I started paying insurance on it in October 2008. The title was transfered to my name and it was registered in my name January 2009.

    My question is: This October 2009, will providing documentation showing insurance for 1 year, and the continuation of ownership from my parents to me allow me to qualify for the program?
    We've had this car forever and it would seem very out-of-spirit of the law to disqualify me for what appears now to be a very poorly timed title transfer.

    Any thoughts? Is there anyone I can contact about this? Any way to have an exception made?
  • joel0622joel0622 Posts: 3,302
    Well I see it is business as usual for the goverment. They were so excited to say look at us we did something that they have this thing so confusing it isn't even funny. They also have the cart before the horse. The dealers still have no idea how to sign up, we don't know what to do with the cars, we don't know who is going to pay to have them scrapped, who pays to get them to the scrap yard, etc,etc, etc, etc.

    My understanding is that there is an age restriction. The cars can be no older the 25 years.

    Allot of good info on the official site

    cars.gov

    Your trade-in vehicle must

    have been manufactured less than 25 years before the date you trade it in
    have a “new” combined city/highway fuel economy of 18 miles per gallon or less
    be in drivable condition
    be continuously insured and registered to the same owner for the full year preceding the trade-in
    Note that work trucks (i.e., very large pickup trucks and cargo vans) have different requirements.
  • I'm trying to purchase a Honda Accord LX-P. I was wondering if anyone could advise me on whether to wait for this bill to go into effect for my SUV that qualifies for $4500, and lose the Honda incentives, or go ahead and buy the accord, and later try to sell my SUV (I know I wont get $4500 for it if I sold it).
  • volvomaxvolvomax Posts: 5,274
    How much are the Honda incentives and how much could you get for your SUV?
  • jeff71jeff71 Posts: 11
    I think that you are probably excluded on this technicality, but you can hold out hope that the program will be extended beyond November and you will qualify in January.
  • I would qualify for $4500 with the bill. If I traded in my SUV right now, I would probably get $3500-$3700. The incentives are 3.9% APR and $1500 cash to dealership, which got me a quote for $19270. If I waited until after July 6th, which is when the incentives end, I would lose the $1500 reduction in price. Do you know if Honda offers incentives more than once in a year?
  • volvomaxvolvomax Posts: 5,274
    like everyone else, Honda probably offers some kind of incentives all the time.
    Doing the deal now might cost you a grand, waiting might cost you more.
  • oldfarmer50oldfarmer50 Posts: 6,268
    "...waiting might cost you more..."

    Especially if the car companies cut back on incentives because Uncle Sam is providing them. ;)

    2009 PT Cruiser, 2008 Eclipse, 1995 Mark VIII, 1988 GMC Van

  • greanpea68greanpea68 Posts: 1,996
    Doing the deal now might cost you a grand, waiting might cost you more.

    Replies to this message:


    Nope doing the deal would cost him $3000 right now.... What you were reading is what he thought he could get for a trade in.... but did he have his vehicle appraised? And it is my understanding he would get sale price... trade in.... incentives rfrom manufacturer.... than minus the (bail out) $4500 gov. rebate.... Go ahead and wait.... I can't wait to see how this one plays out.... As I and Joel have said, Who is responsible for the cash ($3500 or $4500) who is responsible for paying of the disposal of the vehicle???

    Awesome.... Now we get to add another fee tothe contract... $1195 for disposal fee :P

    Can't wait to see how this unfolds.... not enough things in place for it tohappen right now :surprise:

    GP
  • volvomaxvolvomax Posts: 5,274
    Obviously, I'm assuming his trade is really worth $3500. It may or may not be.
    Deal now would be car minus current incentives minus $3500 trade.
    Deal future would be car, minus future incentives(which can go up or down) minus $4500 gov't cheese.
    Disposing of the trade wouldn't be tough. Call a wrecking yard,have car hauled away, get receipt from the wrecking yard that the car was scrapped.
    IF his trade is worth $3500, the most he would gain by waiting is $1000.
    In the grand scheme of things,may not be worth waiting for. Trade could take a dump, Honda incentives could go down. Just a roll of the dice.
  • Thanks for all your insight in weighing this out with me. My SUV has a trade-in value of $3600 according to Kelly BB. I went in to the Honda dealership today and basically told him that I would trade in and buy a car TODAY if he would give me something close to the "cheese" that the govt would ($4500). So he gave me $4300 for the trade!! I asked him then to also absorb title and registration fees which was another $267. So I guess I didn't risk waiting, rather took the Honda incentives & special APR. When I punched the #s in, it was more lucrative to take these while they were being offered, than getting the $4500 from Uncle Sam and possibly losing out on the incentives, not to mention the salesman's struggle to somehow sell before June 30th. I am a "she" by the way :) Thanks again.
  • After poring over the bill for hours and calling the CARS hotline, I finally figured out how the bill works. First the dealer has to register to participate in the CARS program. If the traded-in vehicle fits the criteria of the bill, the govt gives the dealer a voucher for either $3500 or $4500 (which ever applies). The dealer can only apply for vouchers after he registers and cannot apply them retroactively. The dealer is then responsible for scrapping the trade-in - not YOU or ME!!!. We'd never get to see the voucher the dealer gets for the trade-in..the amount simply gets subtracted from the sale price of the new vehicle. Hope this helps!
  • greanpea68greanpea68 Posts: 1,996
    The dealer is then responsible for scrapping the trade-in - not YOU or ME!!!.

    For the record I work for a dealer..... You are correct but, the concern is how long will it take before the dealer recieves his money from the government

    GP
  • joel0622joel0622 Posts: 3,302
    GP, the cars.gov site says within 10 days. My question is who pays to scrap the cars? Can we sell them to a junk yard? do we have to pull the tranny and block?
  • greanpea68greanpea68 Posts: 1,996
    My question is who pays to scrap the cars? Can we sell them to a junk yard? do we have to pull the tranny and block?

    That is some of the questions we have here also... Who is going to pay for the disposal of the vehicle.... My understanding is that we need proof that the vehicle had been completely destoyed to recieve payment from the government... What about the transport fee to the junk yard.... It appears to me that these services will be included in the Vouchure of $3500 or $4500 , I don't believe Obama will pay for the tow, and the destuction of these vehicles :surprise:

    GP
  • The dealer is responsible for the towing, and annihilation of the clunker.
  • joel0622joel0622 Posts: 3,302
    Found out two things yesterday. One is that any dealer caught not executing the program properly will be fined $15K per violation. Also learned that the dealer will recieve a $50 admin fee for each transaction. So that means if you are due $4500 from Uncle Obama you will get $4550.

    We called the DOT and they are as clueless on it as we are. They still don't have anything iron clad yet. The major scrap yard in the area has also been trying to get info and they have nothing for them either.
  • dtownfbdtownfb Posts: 2,915
    To be fair Joel, it was just signed last week and will not go into affect for a few more weeks so that things like this can be resolved.

    I think it's good that you all are asking these questions (and answering them) in a public forum like this so we all learn.
  • kdhspyderkdhspyder Posts: 7,160
    As with all dealers we are setting up the procedures and increaing our understanding of how the program might work. Yes it appears that the dealer gets an additional fee for the administrative work but the towing cost ( usually nominal ) will be the expense of the dealer or the scrapper.

    A buyer could strip all the good parts from the trade before bringing it in....and he should if he has the interest and wherewithall to do so ... as long as the vehicle is drivable. Or, the dealer could strip out everything except the engine which must be crushed ( but most dealers don't want that junk hanging around ). Or, the junkyard/scrapper could strip off the good parts ( most likely scenario ) and keep them for future usage.

    A $1500 'junker' probably has about $500 to $1000 worth of useful parts excluding the engine. This is a bit of windfall for the junkyards. They're getting these vehicles and parts essentially free of charge except for the cost to go get them from the local dealers. Then after they crush the vehicles they sell the scrap steel and iron at the going market rate to overseas buyers and to the new steel mini-mills which use scrap metal as the primary feedstock for the furnaces.
  • kernickkernick Posts: 4,072
    I can see the dealer being held responsible for making sure the vehicle gets moved and signed over to a junkyard, but how is the dealer sure or responsible that the clunker will get crushed, or get crushed in a timely manner?

    How does the dealer know that the junkyard doesn't resell the drivetrain to be rebuilt? Or what if the junkyard simply has a backlog, or wants to remove more parts, and doesn't crush the vehicle for 4 months? Is the dealer responsible for that? Does the dealer get the voucher, or get fined if any of these things happen at the junkyard?

    If I were a dealer, particularly not entry-level vehicles I might avoid this clunker-program, and not signup for it.
  • dtownfbdtownfb Posts: 2,915
    "If I were a dealer, particularly not entry-level vehicles I might avoid this clunker-program, and not signup for it."

    It would be foolish for a dealer to not participate in this program. No upfront fees to join and no telling how many sales you may be able to get from it. In today's market, you can't afford to exclude yourself from this program.

    it will be interesting to see the advertising from the dealer's once this bill goes into affect.
  • Call NHTSA...that's who I called and the person that answered the hotline seemed to know what he was talking about. Toll-Free: 1-888-327-4236
  • kernickkernick Posts: 4,072
    It would be foolish for a dealer to not participate in this program.

    Let me better define "not entry-level vehicles" for you and give some reasoning. There is quite a list of Makes that do not sell entry-level vehicles: the obvious are Mercedes, Jaguar, Cadillac, Lincoln, Lexus, BMW, Infiniti, Acura, Buick, Land Rover, and maybe a few others.

    Now while there will always be a few millionaires driving around in the '88 Ford Bronco, there really are very, very few, who all of a sudden are going to say "gee, I'm going to trade in the ol' Bronc for an Infiniti G37 coupe". The typical person with a clunker a) can not afford the payments on a new $25K+ non-entry-level vehicle, and b) probably couldn't get financing.

    Secondly there are not many people driving clunkers who are going to come in the dealership looking like they work a decent job. All that marketing money and the $ spent to make the dealerships look really nice and shiny - all to create an atmosphere - can be brought down by having the '88 Bronc in the customers' spot, and the customer wearing the Walmart happy-face shirt.

    Appearances and atmosphere are very important to many businesses. Show up looking like a bum, and it doesn't matter if you can squeak by with the $; they don't want you in.
  • joel0622joel0622 Posts: 3,302
    Call NHTSA...that's who I called and the person that answered the hotline seemed to know what he was talking about. Toll-Free: 1-888-327-4236

    We called 3 different times asking the same question and got 3 different answers.

    The best advice for now is for everyone to sit tight, ignore everything you have heard, and wait for the final word on it to come out
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