Thoughts on Cash for Clunkers

by Katy on August 8, 2009 · 13 comments

Cash For Clunkers

I have watched from afar the Cash for Clunkers program that rewards new car buyers either $3500 or $4500 towards purchasing more gas efficient vehicles. This government incentive is meant to stimulate the economy while moving the American public to dump their gas guzzlers.

It has been more successful than anyone could have imagined. (Obama and congress just added an extra 2 billion dollars to the program!) But could Cash for Clunkers have been designed to make more of a difference?

  • Car buyers have to trade in a vehicle that gets less than 18 miles per gallon, and have to buy a car that gets at least 22 miles per gallon.
  • SUV/truck/mini-van buyers have only to buy a new vehicle that get 1-2 miles per gallon more.

That’s setting the bar awfully low.

This could have been an opportunity to make a huge difference in moving Americans towards driving extremely fuel efficient vehicles. Instead it seems to be a program aimed more at new vehicle sales than anything environmentally inclined.

Of course, many people are going above and beyond the government requirements in exceeding the rules.

Today’s Oregonian newspaper had a really interesting article addressing the costs both financially and environmentally of the Cash for Clunkers programs.

Click here to read the ‘Clunkers’ Environmental Payoff Could Take Years article.

Have you taken advantage of the Cash for Clunkers program? Please share your thoughts in the comments section below.

Katy Wolk-Stanley

“Use it up, wear it out, make it do or do without.”

{ 13 comments… read them below or add one }

Andy August 8, 2009 at 6:24 pm

Complete waste of money if you ask me.

Those who can’t afford a car are still hurting from fare increase in the local transit systems, while those who happened to buy an SUV before now get rewarded with a bunch of money for buying a new car. That’s just messed up!

I sold my clunker for $1000 and bought a fancy bike with the money. That’s the way it should be!


Kate August 8, 2009 at 6:35 pm

The bar is way too low to have an environmental effect. I think this program is like the rebate checks – it’s a shot of cash that causes a small blip in car sales. Is this what our economy and environment need? No, job creation would be better.


Karen August 8, 2009 at 6:51 pm

Andy, what a great trade off you made!

In terms of sense, the whole clunkers thing is just about on target for 99% of the plans to come out of government committees. They sure did set the bar low re mileage, and how stupid to disallow a car from 1982 or older, while allowing people to trade in their 2 year old Hummers, when those buyers knew they were buying cars with horrible mileage to begin with. Certainly is an odd group to reward!

My personal connection to it is, we have a ’99 Jeep that would qualify, mileagewise, because yeah, the mileage isn’t good. We had no real plans to take part in this program, but we did think it through in the abstract. But I think the environmental aspect of the clunker program is a smokescreen–if we really cared, we would have pushed for stricter mileage requirements for the past 20 years. Instead, we gave write offs to people who bought SUVs, screwing America environmentally and taxwise. And then there’s the 3 billion dollars for the clunker program, paid for by us. Oh my.

Obviously, the clunker program’s aim is to save the ailing car dealers more than it is to help the environment, and give us some hope that the economy can be boosted, starting with car sales. But what a waste–to take part in this program, our Jeep would have to be crushed instead of passed on to someone else. Logically, keeping a car running and tuned up etc has to be better than causing new cars to be made, despite the mileage issue.


Jodi August 8, 2009 at 8:59 pm

Yup, they set the mileage bar way too low. It should be at least 30 MPG.


liljan98 August 8, 2009 at 11:47 pm

I didn’t know that another government than the German put up such a joke of a program. We’ve got something similiar in Germany as well since earlier this year and all experts from the enviromental field say it’s a waste of money, has almost no positive effect for the environment and will hurt the car manufacturers in the long run. They might sell a lot of cars right now, but they will only sell a few cars in the next few years, because almost everyone will have a new car by then.


Charyl August 9, 2009 at 7:13 am

It doesn’t matter how good the incentives are when one is laidoff and broke. This is just another government bail out for corporate America on the backs of tax payers. Booooo!


AJ in AZ August 9, 2009 at 8:21 am

The same rules should apply to SUVs, if not the actual mpg, at least that the new vehicle must get say 8 mpg more than the old one. Why oh why must SUVs always get special rules? The country is overrun with SUVs. I speak as someone with a Jeep Liberty who lives on a BLM road impassable when it rains unless you are in 4-wheel drive. I would LOVE to get a small SUV or crossover with much better gas mileage but my Liberty is worth a lot more than $4500.


Red Icculus August 9, 2009 at 12:40 pm

Cash for Clunkers is an absolute failure mired in government bureacracy.

I have 2 friends that had their cars junked and their new car hasn’t been delivered yet because the dealership isn’t sure if they are going to get paid by the government. Individuals are able spend their money and make choices better than any bloated government bureaucracy imposed on people.

If they wanted to get rid of gas guzzlers, they would have reduced imports on gas so that gas was more expensive. The market would follow. Instead, they take money from those that provide jobs and wealth to the economy to fund a handout to people when we are printing money to pay for government programs.

Cash for Clunkers is an irresponsible scam to punish those that want to achieve in life.


Christy August 10, 2009 at 6:42 am

They had on the local news here (Minneapolis/St. Paul) that the auto repair garages are already seeing a decrease in business. People that had older cars that needed repairs have been trading them in to get the $4,500 credit. Fewer older cars needing repairs and maintenance = less business for mechanics. Also, some of the charities that accept donations of used cars are expecting a drop-off in donations which means less funds for their programs.

It seems like there will also be a shortage of lower-priced used cars for a while. I also would have liked to see the better “clunkers” be reused and go towards programs that help the working poor who have a hard time affording a car in the first place.

In my opinion, there are good points and bad points about the Cash for Clunkers program. However, it seems like it mainly benefits the automakers and not much consideration was taken into the subsidiary effects the program will have in the longer term.


Jeanine August 10, 2009 at 8:08 am

It worked out awesome for us.

A yearand some months ago my DH purchased a 92 Cheverlot Silverado for 1200.00.

It had 195,000 miles on it.

It was mostly a work truck and all in all we put about 800.00 into it for tires, and minor upkeep.

Keeping up? That’s 2k invested and with the CFC program, we are alreaded 1500 up in equity.

We got the 4500 dollars plus the dealership matched up to 3500.00

So…..with 8k in rebates, we bought the most basic model of a Chevy Aveo, the only option is air and radio, and paid 3000.00 plu TTFs for it.

It currently has 120 miles on it, and whatever the standard warrenty that comes with.

I think we did good.

*I’m mad the dealer dealer didn’t match the full 4500 though….Ah well. Can’t have everything.

Pros: Great Gas mileage
Cons: Not too many safety features, no side air bags and when it comes time for new tires I’ll replace the current ones with some that have better traction.

Don’t usually care for the government to get involved in such affairs, but this worked out awesome for us.


Sierra August 10, 2009 at 9:35 pm

I thought about trading in my 13-year-old van. We hardly ever drive it, so the environmental impact is not huge, but it takes on about a gallon of water every time it rains, so a new car would not be remiss. I don’t expect to get a cent for it, and am trying to drive it till it collapses. $4500 toward a new car would be nice. But we didn’t qualify because the mileage on it was too good when it was new.


alunatunes August 11, 2009 at 2:10 pm

At 11 years old, I am sure my Miss Betsy Jeep Cherokee could qualify as a “clunker.” But to me, she is paid for and gets great gas mileage. I drive her rarely but it is good to know she is there to take me where I need to go.
I am sure all those “clunkers” could have been revamped and used by people who cannot afford a new car. Our government continues to be wasteful beyond all belief.


miss moneybags August 13, 2009 at 1:17 pm

I’m actually incredibly angry about this program. The “clunkers” that are turned in are purposefully damaged so they cannot be resold and the engine cannot be parted out. This program is only for new car purchases. The amount of resources that go into scraping a usable car and building a new one from scratch far outweigh the environmental costs of continuing to drive a gas-guzzler. Also, as others have mentioned, the required MPG is too low. Many people could have achieved 19 miles per gallon on their old cars just by properly inflating their tires. It’s outrageous. This does not help the people who need a working car the most–the working poor. In addition to not being able to afford the cost of a new car, even with the trade-in credit, this group of people now have fewer choices of usable used vehicles to choose from. The only group who benefit from this program are the car companies–who are the root of this problem to begin with. People who want cash for their clunker should consider selling their car (even for scrap if it’s that far gone) and putting that cash toward a used car with better gas milage. That’s a far smarter purchase for the consumer and the environment.


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