9 Things You Need To Know About “Cash For Clunkers”
By Jim Baxter, NMA President
A recent public information report on Congress’s “Cash for Clunkers” legislation has been released to spell out the general details. Keep in mind that this is not set in concrete and the final outcome is not assured.
Here are the general details as they are currently known:
1) Who is for it?
Car companies, their suppliers, auto workers, and car dealers.
2) Who is against it?
Environmental groups that want to force higher fuel saving standards are the most mentioned opponents. However, auto enthusiasts, car collectors, parts re-manufacturers, and perhaps elements of the salvage industry are looking for ways to put sand in the gears when it comes to destroying the traded in vehicles. No one really knows what the effect will be on the used car and truck market.
3) What is it going to cost?
The plan is to take $4 billion out of the $787 economic stimulus package.
4) Who gets what?
The government will send $4500 or $3500, depending on the level of fuel mileage improvement, directly to the dealer that sells the car. Eligible trade-in vehicles must have fuel economy ratings of 18 MPG or lower and have been registered for at least a year for road use. The $3500 payment is made for vehicles that get at least 4 MPG better mileage than the trade-in vehicle. The $4500 payments kick in for models that get 10 MPG, or better, above the trade-in vehicle’s mileage.
5) What happens to the trade-ins?
All major driveline components are destroyed. Body panels can be recycled.
6) Are trucks treated the same as passenger cars?
No. Most SUVs, vans, and pick-ups have the same 18 MPG threshold, but the new unit need only offer 2 MPG improvement in mileage for the $3500 payment. The $4500 payment kicks in with a 5 MPG improvement in mileage. Heavy duty trucks have yet different standards.
7) What if the new car is bought before this law goes into effect?
The effective date is set back to March 30th 2009 and the program is limited to one year.
8) Will this law apply to newer used vehicles?
There are proposals to extend the benefits to newer used vehicles but they are still being debated, as are most elements of this bill.
9) Will this bill really benefit the auto industry and the economy?
Probably not. It may slightly “front load” sales in 2009, but these are sales that would have occurred anyway, just a few months later. With the incentives being in place for a full year, purchasers would not be compelled to buy until early in 2010. By that time the market could well be recovering on its own. Further, many people in the market to buy a new car, would do so without the government incentive. Other folks who can’t afford a new car are still not going to be able to afford a new car, even with government aid. The incentives may push purchasers looking at newer used cars to consider a new car, if incentives are not applied to newer used vehicles.
Like all attempts on the part of Government to pick winners and losers, instead of sticking to being an impartial referee, there will be unintended consequences we cannot yet even begin to imagine.
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It is stupid for you guys to be arguing amongst yourself over how this might or might not help you.
Go argue over gas milage specs elsewhere, this is about more government meddling and wasting, and keeping us -all of us in debt.
IF you really are an auto enthusiast, hand deliver a letter to your representatives to to appose this nonsense, and start getting involved.
I cant even believe how quickly the comments got off topic. Everything government touches turns to crap.
Deric, why would an auto enthusiast be against this? No, an auto enthusiast woud be for this to be able to upgrade to a better vehicle cheaper. Political enthusiasts are the ones that would be agianst this. You are a political enthusiast.
What will they use as the “official” fuel rating? My Taurus only gets 17mpg city, but 22 highway. So, does it qualify? Also, it’s a 1999, so realistically it probably gets worse mileage than that (I haven’t tracked it in a few years).
Brian the mpg is what was on the sticker. I know of no Taurus ever made with that low of milage statistics. Mine used to average 27 mpg to 28 mpg combined. It got 30 mpg taking it easy on the highway. I know there was a higher performance model but far better than 22.
Ford did dick with axle ratios and taking EGR off, putting it back on.
They also took the second rear muffler off [dropping power] then they put it back on.
It is Ford, they do stuff like that.
Randy,
I still have the original dealer sticker. I was a little off, but it claims 19city, 21hwy for my V6 Taurus (I knew it was around there). This is the standard V6, not the upgrade with the extra HP.
Brian
Brian what the heck year was that? For 1997 which was the year I had the figures were
City:17 MPG – 20 MPG
Highway: 25 MPG – 28 MPG.
The V8 got 25 mpg highway with the V6 rated at 28 mpg. I had the V6 and like I said I averaged 27 to 28 overall so those were conservative figures.
Brian earlier I did a quick search for the mileage that Taurus got each year it was manufactured and did not see the figures you are quoting. They are pretty close to the figures that I gave.
From what I have read they did a similar thing in Germany and had a 40% increase in sales. I guess a possible 40% increase in sales means nothing to Jim Baxter. Maybe if they had done this 6 months ago there would not have been any car manufacturer bankruptcies.
The reason for that in Europe is because of DIESELS……… DIESELS people!!!!! Not this inefficient gas crap we continue to pour resources in to(diesels run even better on alcohol than gas, and originally ran on peanut oil). Their diesels can manage 80 mpg, imperial or whatever probably translates to 60+mpg US. So it of course pays to upgrade if you have an older diesel that got 30-40mpg and doesn’t have the NOx cleaning tech that Germany invented to sell them in CA, and or are in the market for a SMART car, if you live in the city.
Cripe, Audi has a 4.0 V8 twin turbo diesel for the A8 that gets 40mpg* Europe only. That’s a HELL of a lot better than what Merc gives the US market with their 33-35mpg V6 E class at $50k, or the idiots at BMW and their 35mpg twin turbo 335tdi at about the same price, but for a smaller car. The only diesels available worth getting in the US aren’t here yet(Audi A4), save for the VW Jetta TDI. Everything else is a diesel hog(VW tow-rag/Audi Q7)
Fleet Admiral I looked at the specs on your Audis. I am sorry but the largest Audi has about the same luggage space as the smallest Ford Focus. A vehicle is no good to me unless you can haul luggage and skis for 3 or 4 people. We have different priorites. Yours is to be able to drive 170 mph and mine is to get around comfortably with the number of people and luggage that I want with very good gas milage.
Randy, I don’t know where you’re getting your info from, but it’s erroneous. All you have to do is look at the trunk pics for Audis on EBAY to see they’re far more cavernous than ANY freakin car made in the US or even Europe, not to mention split folding rear seats. BMW, Merc are all a joke compared to the VW/Audi line for trunk space.
Not to mention the Germans specialize in STATION WAGONS. Something the US seems to have forgotten in favor of “Sport”UVS.. chuckle. Nothing “sport” about them unless you own a Porsche Cayenne, twin turbo.
Honsetly this tirade against European autos just won’t do.. it won’t hold up.
Fleet Admiral I got my information from the Audi web site not Ebay? Does Audi sell new cars on Ebay? You look up the specs. I also do not want to buy an Audi Station Wagon to replace what a US compact car can do for 1/4 the price. From what I have seen Ford has the largest trunks and space out there.
Your precious frod focus has 13.8cu trunk space, Audi A4 beats it by 3ft at 16.9. Seats down it has 34. As I said, NO one beats Audi/VW on cargo capacity. And cripe OH MY, the A3, which is even SMALLER has MORE trunk space at 19.5!! That’s 3 more than the A4 which was already 3 more than the focus for a total of 6cu ft more.
How do those rascally Germans do it!?
Oh,and ain’t NO one going to be haulin skis in a frod focus. My A6 has a ski passthrough in the rear seat. No need for a rack on top. And when that passthrough isn’t being used, there is a TILTABLE*read whiplash prevention* height adjustable middle headrest for 5 passenger comfort while italian operatic music is blaring because this car is on a mission to conquer.
And reading up on the focus, ambient LED lighting? heh, Audi has had it for decades since ’98 and improved for the A8 in ’04
http://www.thhe.dk/Audi_A8_3,7.htm
In the roof for map lighting(which frod is only considering now and hasn’t implemented) and door grab handles(which frod is only considering and hasn’t implemented). Get with it frod, the competition has you beat by 10 years along with more fuel efficient engines. Why do you think ALL US auto makers are bankrupt? Because they don’t know how to build cars. And people like me who have been buying Euro and Japanese cars have known this for decades and that’s how long they’ve been bankrupt. It’s been a long time coming.
That’s why this cash for crap program works in Europe only, because they actually IMPROVE their cars, not that they can by much since all they do is add more electronics to them instead of suspension and safety which they are almost already maxed out on. 10+ yrs ago they had diesels that got 25-50mpg, now they get 60-80mpg AND have implemented emissions controls which are now required on all US diesels. The US comes nowhere near that for mpg since we’re so stuck on gas and quick 0-60. I’d be more than happy to trade my twin turbo Audi at 5.8 to 60 for a 8 sec 50mpg diesel A4 or A8. But the US resists import of those cars due to competition because it would bankrupt the auto industry here. Well, back to square one because it happened long ago.
I did look up the cargo for the A8 and it states it at 14.6 something, which is inaccurate to say the least since it is just as big as an A6. Or that could be the fact that for what it lacks in trunk space it more than makes up for in rear legroom which you’ll not find on even the most expensive caddy or town car.
Fleet Admiral oooo. An Audi has passthough seats. Cool. Well the Ford Focus does too. Last winter I went skiing with two other people and we had 3 sets of skis and and boots and helmets and coats and luggage for 10 days all inside a Ford Focus. It is a deluxe model and is at a very expensive 15 grand with taxes included. How about your precious Audi. You know I would hope those things are good cars because I could by many US cars for the price of one of them. I never take them in the shop either since they can be fixed myself if anything needs replacing because I can pick up parts locally at a very good price.
I would say that you should move back to Germany because the US is definitely not good enough for you.