A $ 1 billion dollar budget is just about out of gas.
After just seven days, it appears the Government is all out of money for the Cash for Clunkers program. Congress passed the program and gave it an ending date of Nov. 1 or when the $1 billion budget was spent. According to CNN Money, money is drying up fast.
Clunkers Law: It gives car buyers vouchers worth up to $4,500 toward a new car, providing they trade in a gas-guzzler. Sounds like the perfect way to jump start car-buying while cleaning up the environment, but it probably won’t do either one. Because when you look at the fine print, almost nobody will get the full benefit.
For example, the $3,500 to $4,500 voucher only kicks in if your trade-in is worth less than that. In other words, if the car you’re trading in is worth more than $4,500, you won’t get a dime.
Problem two? Your trade-in car has to get 18 miles per gallon or less. While some trucks and SUVs will pass that test, almost all cars…even old ones…get better mileage than that.
So the Cash for Clunkers program is really only good for people who are driving a gas guzzler worth less than $4,500: probably a group of people who are either very frugal… or can’t afford a new car.
And if you’re in either of those groups, you’re probably better off selling that gas guzzler yourself, rather than accepting a lousy trade-in offer, then buying a used car that gets better mileage.
If you’re driving a clunker and thinking about buying a new car, you should check your car’s gas mileage at the EPA website… and it’s trade-in value. Read the details and restrictions of this new program, then see if it makes sense.
But the bottom line of this new deal is that’s it’s really not much of a deal at all, for you, Detroit, or the environment.