Turns out there are so many things wrong with Cash for Clunkers (CFC) that we can only scratch the surface here. The biggest flaw so far is the unfortunate bait-and-switch the government pulled in changing the fuel economy rating for some 30,000 vehicle models, which has caused and will cause situations like this:
“My wife just received a call from the sales manager saying that our clunker doesn’t qualify anymore, and that we could either pay the extra $4,500 or return the new car (and get our old car back),” Greg Straka wrote Tuesday on a message board at the Edmunds.com automotive web site.
He had signed a document agreeing to provide additional documentation needed to process his trade-in, but had not done so yet, Straka wrote.
He had made the deal for his new car last Saturday, the day after program rules were supposed to have been finalized, Straka wrote in an e-mail to CNNMoney.com. But the fuel economy information on the car apparently changed the next day, he said.
The Feds changed the rules, last-minute, because of bad data on some models. Imagine that! Many dealers are unhappy with the whole program, saying, among other things, “We will waste more time f****** with this than it will ever be worth. The rebates are in place to subsidize the deal. Collecting our money will be a full time job.”
So if you as a potential trader are trying to get in on the scam, make sure you qualify. The government has a trade qualification site to walk you through the process. So does Ford. But the whole program is cumbersome, bureaucratic, and badly conceived.
On the latter point, this video brings up both valid and silly objections to the program. You be the judge.
Well, over half the comments received on the video above at The Truth About Cars were slams at Fox News and/or Stuart Varney. But here are some with more substance. Many pointed out that the program doesn’t do much of anything for the environment.
If the vouchers all go to people that would have bought a more fuel efficient car anyway, then they don’t help the environment. If someone takes the $4,500 and decides that with that now they can use that money to step up to the V6 Malibu instead of the four cylinder (or the Cobalt) to replace their truck, then it doesn’t help the environment. If all it does is cause someone to replace their truck one year earlier, it helps the environment a small bit, but not all that much.
One dealer said,
People don’t just want the money, they want to be spending less on fuel. Yes, we are selling some SUVs, CUVs, and trucks on the program, but those CUVs get almost as good of mileage as many cars, and some people just need an SUV or truck. Plus, even if the fuel economy improvement is only 1 or 2 mpg, the difference in tailpipe emissions between a 1990 Dodge Pickup and a 2009 F-150 is orders of magnitude greater.
And:
This segment feels less like watching Fox news and more like watching the Simpsons or Family Guy. It’s Fox actually telling the truth. CFC is narrowly tailored to help the “domestics” without violating trade agreements. Worse, it’s the federal government assisting scum bag dealers in doing bait and switches.
Why don’t you weigh in on this? Is CFC of real benefit to anybody? What do taxpayers get out of it? Should the $4,500 rebate be taxed?
—jgoods
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