The US Congress is considering a bill that would pay you to trade in your clunker for $3500 to $4500, depending on the mileage improvement for your new car. The EPA city mileage must be less than 18 MPG to be a clunker. You probably wouldn’t want to do it if your car is worth more than the voucher you’d receive. You get $3500 if the newer car (can be used car) gets 4 to 9 MPG better mileage, and $4500 if the newer car gets 10 MPG+ better mileage. For light trucks, your get $3500 for 2 to 4 MPG better and $4500 for at least a 5 MPG improvement. Any takers out there? BTW, the dealer must scrap the engine and transmission, but can sell the rest of the car as parts.
It’s nice to see our leadership in finally getting SERIOUS about cutting our energy demand…I have a '92 Crown Vic that will be in serious jeopardy if this bill becomes law…
What happens if your car pre-dates EPA mileage ratings?
So if those with old high mileage cars all rush to the deal and the dealers take them in and scrap the engines, what will those who need something but cannot afford to make payments drive? The low cost used car supply will disappear.
I know, the feds will take even more of our tax money and give it GMAC with the requirement that they make low interest, high-risk, creatively financed loans to those who cannot afford to buy the newer cars that are all the used market will have available because of the previous federal mandate. Of course, to do this they’ll have to “bundle” them together with more secure high interest loans and sell them on the secondary market.
My head is spinning.
At first glance, I thought that this would be a great idea. I have a 1978 Olds Cutlass with the 4-4-2 package. I’ve owned it since it was new. This would be a way to either get the Mazda Miata that I keep drooling over, or a compact pick-up truck which I would like to have when I retire–I want to do volunteer work for an organization in my community that does home repair so that older people on fixed incomes can stay in their houses.
However, I doubt that my old car even has an EPA mileage rating and I used to get 22-23 miles per gallon with its 260 cubic inch V-8 engine. My son drives a 2000 Ford Windstar that is probably worth $3000 at the most. However, he is a teacher and is trying to earn an advanced degree. He wouldn’t be able to take advantage of this–he is doing is best to maintain his Windstar. The Windstar may even have a higher EPA rating that 18 MPG. In fact, I’m not certain who this program would benefit. Many people who drive these clunkers couldn’t afford to upgrade even if they could get $4500 for the clunker. I have a friend who drives a 1990 Honda. This car should be replaced, but this car doesn’t qualify.
Most clunkers fade away because it isn’t feasible to keep them on the road. This sounds like a scheme to benefit new car dealers so that they can push a new or late model used car off on a person who has the clunker for the down payment. Lending organizations will welcome this as a way to push loans.
Twice I have had dealers sell me a car for less if I didn’t trade in the clunker I was driving than if I did. In fact, my 1978 Olds is one such clunker. Back in December of 1995 a dealer sold me a 1993 Olds 88 for less money if I didn’t trade the car–I would have had to pay him $300 to take the car. If the bill goes through, the government will pay for junk cars. I don’t like the idea.
Doesn’t matter how much they give me for my 92 Explorer or my 79 chevy pickup.
There’s still no conceivable way I can afford the payments on the remaining $20,000.00 .
You have the right perspective, in my opinion. One of the contributing factors to our present economic situation has been too much consumer debt. This clunker bill,it seems to me, will cause even more consumer debt. I’ve always bought cars for cash. My first car, a 1947 Pontiac, cost me $75 back in 1962. I drove it carefully and it made the 350 mile trip to graduate school for me. I now deal for a car in the following way: “I have some money and you have a car. How much of my money is it going to take to buy your car? You give me a price that is good for 3 days. If another dealer has a better price, he gets my money. I won’t tell you the prices I have so far and I won’t tell another dealer your price”. I really don’t want the government as part of this negotiation. However, if the government wants to come and buy my 1978 Oldsmobile for $3500 or $4500 outright, I’ll talk. In fact, the government can come to me and say, “We have some taxpayer’s money and you have a car. How much of the taxpayer’s money would you take for your car?” (I might go as low as $500, but don’t tell Uncle Sam).
Our government doesn’t have any “Taxpayer Money”. We are flat broke. Our Government owes bondholders $11 Trillion Dollars…That amount of debt can never be paid off by the Taxpayers or anyone else. So if they are just going to print it up and give it away, you might as well get a piece of the action!
Didn’t they do that several years ago with the housing market…
Will they ever learn?
And lets not forget the known $1300(Atleast?) markup that’s coming for ALL vehicles within the next couple years.
I’m all for it as long as they don’t tank the auto industry more than the housing market
Minivan and SUV are both clunkers, we average 10k per year per vehicle, so penalize us and the guy that gets 21 mpg in city but drives 30 k per year is exempt? Logic does not rule in this case
The British government has announced a plan, shared with the manufacturers, to give $3500 to owners of ANY car older than 1994, I believe. Most British cars already get good mileage, but this is to stimulate the economy. I’m not sure it will work, the Brits made all the stupid financial and real estate mistakes Americans did, and the economy is in a tailspin.
Nice idea with good intentions, but borrowing Chinese money with interest to “give away” is a horrible idea. NO US Govt - it’s not YOUR money to give away.
I agree that improving mileage overall is a good idea, but let the consumer decide when that will be. If oil is as scarce as all the fear-mongers want us to believe, then simple home economics will change product demand without any Govt. intervention.
I myself swapped out the old '90 engine in my car for an '05 turbo model that gets 8 MPG better mileage, pollutes less, and makes more power. And… reusing is much more environmentally sensable than recycling.
But since it started at about 27 MPG, it wouldn’t qualify even if I had decided to junk it instead.
I dunno. I guessed that it was EPA city because the cars mentioned on a web site only seems ed to meet the requirements if the city mileage was considered.
“Our government doesn’t have any “Taxpayer Money”.”
Of Course they do! It may be your children’s or grandchildren’s money, but they have it. Or at lest will have it.
My car qualifies as a certified clunker. It’s worth about $1500. Would I bite? NO. My next car is going to be OLDER than my current one (which is 17). In fact the 1980’s Camaro I plan to purchase would probably get less MPG than my 92 Tempo. I plan on parting with my car when the cost of repairs is worth twice that of the vehicle.