Cash for Clunkers New Car Incentive?

[tekisui]

I have heard about a proposal aimed at encouraging new car buyers. A trade in of an older car(10-15 years) would get $3,000-$5,000. What is the status on this effort? Is there a bill in the works, has it passed yet? What is the time frame?

[MineralMan]

1. That would do me no good whatever.

I drive a 10 year old GMC SUV and a 19 year old Volvo wagon. Both are paid for and have always been paid for. I've never had a car payment, and never will. If you only get the value stated if you buy a new car, then I'll be driving my old vehicles a long time, since I have zero intention of going into debt for a vehicle.

The very people driving the "clunkers" are the ones who cannot afford a car payment as part of their budget. It's a foolish move.

[tekisui]

4. I could afford the payment,

but cannot afford several thousand out of pocket to get a decent used car.

[MineralMan]

14. Several thousand?

I never pay more than $2000 for a vehicle. I look for cars between 10 and 15 years old. Then I inspect them carefully. I'm looking for a well-maintained car. I don't buy rust buckets or ugly cars with body damage. I do buy unpopular cars, though, since I can usually find a better vehicle for the money. Plusses are things like new radiators, a recent brake job, and good tires. I start looking long before I have to buy a replacement vehicle. I buy only proven vehicles with reputations for longevity, which is why I buy Volvos quite frequently. No turbos...ever. They're plain, no-nonsense cars that have long lives if well-maintained. Decent, but not spectacular mileage.

Then, I religiously change oil and perform other regular maintenance. Typically, I will keep these cars for four to five years, then sell them while still in good running condition. Normally, I will get about half what I paid when I sell it. Other times, I donate the vehicle to whatever charity will come and get it, or to someone in desparate need for a running vehicle.

Other benefits include cheaper insurance, since I only buy liability, parts availability, if needed, at the nearest U-pull junkyard, tires that are always loss leaders at tire shops, and more.

Environmental benefits include the fact that the car already exists. No further resources are used to make it. I don't buy oil burners or other polluters. The Volvo, for example, has excellent emissions controls. Is it a hybrid? Nope. But I only drive a vehicle about 5000 miles per year, so I'm not adding much pollution to the environment.

From time to time, I have bought a less-than-stellar vehicle. When that happens, I normally discover that fact after a very short time. I can generally sell it for what I paid for it in that case. I do not ever do major repairs on any of my vehicles. I can normally detect impending doom in advance.

[tekisui]

15. I hear ya.

The truck I drive, and have driven for 5 years cost $1,000. It has over 300,000 miles on it now. I've never spent more than a grand on a car. The last truck I bought, I got for $500, but it is nearly done. I have to get something reliable, and preferably under warranty for my wife to commute to school twice a week over an hour away, and dependable on long trips. I haven't found anything decent for under a few grand around here, and I've been looking. At any rate, we are going to have to get something soon, and may be purchasing a new or nearly new car within the month.

[MineralMan]

19. Everyone has his or her own priorities, of course.

I'm not saying that my strategy will work for everyone. I will say that I would leave tonight on a cross-country drive in my 19 year old Volvo with no concern whatever. Even the fuel tank is full. I'd just get in and go. Still, I understand the need for a later-model car for some people. Long commutes aren't the stuff older cars are made for. If someone drives over 15,000 miles a year, a more recent vehicle is probably a good idea, although I'd sure look for something other than a new car, but with an existing transferrable warranty. The initial depreciation on a new car really blows.

My wife drives the 1999 GMC Jimmy, which we paid $8000 for, five years ago. It has just over 100,000 miles on it now. She wanted something newer, and we had the cash available. She regrets the decision. We've spent another $3000 on repairs to that thing, and she drives even fewer miles than I do. These days, it's relegated to towing the boat around, while she drives the Volvo most of the time. However, when gas prices hit $4.00, I found a used trailer hitch for the Volvo, and it tows the boat just fine, so we can switch cars as needed.

I regret ever setting foot in that dealer's lot and buying the Jimmy. It is the worst vehicle I have ever owned. Now, its value is in the toilet, since there are so many of the things sitting unsold on car lots. It has one more chance. I put a new radiator in it, myself. It will not get another repair that costs more than a couple hundred bucks. It will be replaced with a car using my strategy. My wife is a convert.

[SoCalNative]

5. Disagree

I drive an 11 year old Honda Civic, that I got brand new and that has long been paid off. But I've been thinking of a new car lately and can save up enough in a year or so that I can pay cash for a new car, since I don't like having car payments.

So your theory that "the very people driving the "clunkers" are the ones who cannot afford a car payment as part of their budget" is flawed.

[crazyjoe]

8. except, you don't qualify, your trade in must get less than 18mpg

[MineralMan]

10. Perhaps I should have written...

Many of the people owning clunkers...

I intentionally buy used cars...often ones that are over 10 years old. I've had very, very good success with that strategy. For example, my 1991 Volvo 740 wagon cost me $2000 four years ago. I have had to spend zero dollars for repairs on that vehicle, which I drive less than 5000 miles per year. It currently has 164,000 miles on it. I've owned four other Volvos in the past 40 years. All have reached more than 200,000 miles with no significant repairs being made.

So, I have 36,000 miles to go. I'm 63 years old, so I'll probably keep that Volvo for another six or seven years before getting rid of it.

Quite a bargain, I'd say. I can't think of any reason why I'd purchase a new vehicle. While I could make the payments, I do not choose to. So far, I've spent $500 per year to own the Volvo, and by the time I get rid of it, the car, itself, will have cost me only about $200 per year...about the price of ONE monthly payment for a econobox. Fuel and expendibles are not included, since I'd have those expenses with any vehicle.

As for my other statement, I see lots of folks driving clunkers around my area. I can guarantee that they cannot afford car payments. Many are currently out of work for the time being. Those are the people of whom I speak.

[Ghost in the Machine]

18. An 11 year old Honda Civic isn't a "clunker" (unless you haven't taken care of it properly)

I had a 14 year old Civic that was in almost showroom condition and only had 138,000 miles on it. When it got totaled (6 months after I paid it off), the insurance company paid me more than I paid for it 3 years earlier. I was lucky that I had kept the full coverage on it after it was paid off, and they paid "replacement value".

I'm driving a 12 year old Jeep Grand Cherokee right now, and I wouldn't trade it for the world. I paid cash for it 3 years ago and haven't had a problem with it mechanically (besides normal maintenence).

I can't afford to buy a new vehicle, nor do I *want* one. A car payment is the LAST thing I want in my life right now. I'd rather spend the money I don't have on other things I don't need right now, thank you very much! :-)

[MineralMan]

20. Exactly. The Civic should have several more good years

in it. Plus, the energy used to make it has already been expended, so keeping it and using it saves far more energy than sending it to the junkyard and buying a new vehicle. Besides, it's a good-mileage vehicle already.

[left coaster]

2. I'd like to know more about this one too..

I drive a 20+ year old bomb.. I wonder if my car will qualify..

[rrneck]

3. I need a new ride

but five grand off a twenty thousand dollar truck is still more than I can stand. And I have to have a truck.

[Javaman]

6. here's the latest info I found...

http://blogs.consumerreports.org/cars/2009/05/congress-reaches-compromise-on-cash-for-clunkers-bill.html

if you combine it with the governments hybrid rebate, you could get up to 8 grand in rebates.

I qualify. So If I want one of the new Honda Hybrids costing 21k. I could get it for 13k!!!

[tekisui]

7. Looks like the compromise has been reached, but no vote yet?

[ContinentalOp]

9. I would be sooo pissed if they passed this.

Since just a year ago I sold a 11 year old clunker for a couple hundred bucks and bought a new Prius with NO tax incentives. :mad:

[ContinentalOp]

13. Damn, the more I read about this is really makes me angry.

So we're rewarding people who bought shitty inefficient SUVs for all of these years? And presumably driving up the price of shitty old clunkers? I'm assuming you can now sell a $200 piece of junk for $4000, just so somebody can take advantage of the extra $500 rebate?

[Javaman]

16. Um, yes and no...

in my case. I can't afford a 20k+ car that gets really good mileage. Frankly, I can't afford a 15k car that gets really good mileage, so I had to hold on to my clunker forever. Now I will be able to afford one. if I get a 15k car that gets good mileage, it will cost me 10,500. I can afford that.

If I get the new honda hybrid that costs 21k, with the clunker rebate and the governmental hybrid rebate, it will cost me 13k. Just outside my realm of affordable but I may still bite the bullet.

why do people get pissed off because they chose to get a car and can afford it when those of us who can't afford a new car, get a break?

And frankly, at the end of the day, please put your selfishness aside, this is about less CO2 and using less oil.

I'm glad this came about. And I'm sure many others on DU are delighted for it, even the ones that don't qualify or have already bought a new car.

[Cobalt-60]

11. cash for work has to come first

It's like being shaken by a junkie saying " I know you've got money".
Crappy wages and unstable servant sector jobs do not allow for the acquisition of new cars.

[tammywammy]

12. I know in Texas they have the Air Check program

That gives up to $3000 on older vehicles towards the purchase of a new vehicle. The purpose is to get older cars with poor emissions off the road.

[Javaman]

17. do you have anymore info on that program? nt

[tammywammy]

21. Here's a couple of links

http://www.tceq.state.tx.us/implementation/air/mobilesource/vim/driveclean.html
http://www.tceq.state.tx.us/implementation/air/mobilesource/vim/how_to_apply.html


I also know, that the money goes straight to the dealer. I think the customer brings in a form or something, and the dealer gets the money later on. I also think, off the top of my head, that we've had customers come in and use the Air Check, but purchase pre-owned vehicles, I just don't think they were that old, maybe a year or two.

[Javaman]

22. Thank you, mucho!!! :) nt

[fumsm]

23. Won't pass unless it includes foreign car purchases...

Repukes won't let it. Southern dems will kill it. That simple. These bastards are never happy, and they want what the want and they want it all, now.

I'm all for it, but only if it is limited to US autos. Sorry, to all you foreign car owners. My 9 yr old Chrysler, 9 yr old Pontiac and 7 yr old Chrysler have done me right. Fuck te foreign cars. Why should our taxes help them? They have been given too much already.

[Nay]

24. I recently crunched the numbers and looked at a Jetta TDI for its

exceptionally good gas mileage. I have a 15-yr-old Lexus that gets about 23, but I only drive about 6,000 miles a year, and paying $23,000 for a new car (even taking off $5000 rebate) doesn't make financial or environmental sense. My Lexus was bought used, and environmentally, it has paid its dues many times over just by existing this long--no resources are being used up to make me a "new" car. Secondly, $18,000 ($23,000 minus $5000 rebate) buys a hell of a lot of gas differential between 23 and 40 mpg. I'd probably be dead before I could earn back the $18,000 I spent.

Like others here, I buy only good used cars with excellent service reputations/safety and I keep them until they break irredeemably. I have never had, and will never have, a car payment. You can't imagine how freeing that is.

There is no excuse for buying a new car when there are so many excellent used deals in this country.

[Blue For You]

25. I have a better idea. Cap new car prices at $3000-$5000!

That's twice as much as they're worth.