This month, Congress may have taken the first real step toward recovery for the auto industry when it passed the automotive stimulus bill dubbed “Cash for Clunkers.” The bill, which we touted earlier this year, provides a $4,500 voucher for car owners who currently own rides with fuel efficiency less than 18 miles per gallon and purchase a car with a 10 mile per gallon improvement. (Drivers who buy a car with a four mile per gallon improvement qualify to pocket $3,500.)
On July 1, when the program kicks into gear, you may want to consider shopping the lots. Here are some things to consider, according the newly-launched Cars.gov website, as well as the latest resources for any questions you might have:
- Your vehicle must be less than 25 years old on the trade-in date
- Only new vehicle purchases or leases qualify
- Trade-in vehicles must be registered and insured continuously for the full year preceding the trade-in
- You don’t need a voucher; dealers will apply credit at purchase
- Program runs through November 1, 2009 or when funds are exhausted—whichever comes first
Check out the government site www.Cars.gov for official information on the new program; visit ConsumerAssistanceToRecyleAndSaveProgram.org for a consumer-driven look at what you need to know; or log onto Cars.com for an easy-to-read guide by Patrick Olsen.
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I hope they’ve improved some of the minutiae on this bill, because it had a slew of problems earlier involving handouts for not-so-efficient vehicles. My senator collaborated on this piece a few weeks ago, explaining her problems with it:
http://online.wsj.com/article/SB124467696781404127.html
It will certainly be interesting to see how this effects the auto industry and the environmental impact as well – hard to measure but I’m sure someone will come up with some numbers. It is also interesting to note that the cars turned in will be shredded to ensure they are not used again. (and made into a new line of recycled Ford lamp shades perhaps) :)
Cash for clunkers is only a short term solution. A better way to increase car sales is to simply allow people who donate car to charity to claim the book value on ther taxes.