Turbonetics Blog

Forgive me for not following along with big government logic on this one. What a cluster this entire program turned out to be. It is absolutely the case of doing something just for the sake of activity and that is the most dangerous kind in my opinion. The AAIA and SEMA summed it up pretty darn well in the statements that the two have made over and over. The two had been fighting the bill from the beginning and all the way through the House and Senate. To read a great summary from Autoblog.com you can check it out here. With no advanced planning and course of action the program couldn’t get out of its own way from the beginning. Lets take a quick look at this mess and some of the reasons why it was a failure from before it even started.

1. Possibly the single greatest scam of this whole program is that it is for the environment. The impact and costs to the environment to build new vehicles far outweighs getting cars that have a marginally higher mpg rating on the road in place of others. Absolute craziness.
2. The Go’vt  decides to change the mileage ratings on vehicles the night before the program starts disqualifying many potential vehicles from being traded in. People ready to trade their cars in the next day are now out of luck.
3. Aftermarket companies, enthusiasts and organizations fight against the program to begin with. Viable cars ripe for performance aftermarket parts and accessories are taken off the road and crushed. Charities are going to lose one of the largest and easiest ways to exist and there are many that rely solely on vehicle donations.
4. Entire industries and companies exist to make replacement parts for vehicles to extend their life and provide longer service. They can now kiss any fourth quarter and future sales goodbye.
5. Salvage, scrapyard and metal recyclers are getting the shaft right now but who cares right? Oh and by the way, just wait til you try and find a used part for that Ford Expedition you have next year.
6. 690,114 Roadworthy low cost vehicles are removed from chances of being able to given, donated to charity, or sold at fair market value to people who are in desperate need of a car. My own family members could use a shot at owning one of those 690K+ cars and now all that will happen is the prices of decent shape, decent running and perfectly good older used cars will increase. And how many first cars just got sent to their death. I had a 1969 VW Bug as my first car and was glad for it. There are a lot of good vehicles now gone that could have been someones first car just like my bug.
7. How did the program help the economically challenged and lower middle class? The prices of a new vehicles even with the rebate is not low enough for most low income Americans. See above
8. Zero sustainability. Notta, zip, zilch! It is a one time 3 billion dollar hit to the deficit and ONLY promotes a very short term sales push for new vehicles.
9. Dealers got burned. A recent (admittedly unscientific) survey conducted by Automotive News shows that 44% of the 800 dealers polled wouldn’t want C4C to be extended again, even if the program was modified. Only 3% felt that the program should have been extended without being modified. The biggest issue dealers have with C4C is, unsurprisingly, its lack of timely payment. Some multi-store dealers have millions invested in the program, while little or no money has come in yet. An alarming 23% of dealers say they have had to borrow money to cover the cash crunch left in the wake of the Clunkers program, while an additional 10% say the program has actually sucked enough cash from the coffers that it has put the dealership at risk
10. Consumers got burned. See a handful of comments for people that wanted to participate and buy cars. Some poor people have had deposits sitting since the program began and still have not received their cars.

J says:

August 26, 2009 at 8:40 pm

Here’s the gig. dealer has a $500.00 down payment, the title to my clunker and the new car sitting on his lot and I still have my clunker. You know – Per my dealer “I’m not releasing the new car until I’m paid by the Gov’t.” It’s been since 07/30/09.
Us consumers are getting no help from anywhere. Here’s the real joke. I have emailed and written to the below entities and have received no response except the automated responses. Now I’m looking for a lawyer that will start a class action suit because I know I’m not alone.

Jackie says:

August 26, 2009 at 8:28 pm

I have had signed paperwork since 8/6/09 and still no car. My dealer is awaiting for approval he says not payment, meanwhile I am still driving my clunker. Frustrating that each dealer seems to handle it in a different way. I have no way to proove that he did sumbit paperwork- now that it’s closed I could be out of luck Does anyone know how I can check to see if they even submitted my paperworK?

Rich says:

August 24, 2009 at 7:00 pm

I tried to trade in a car that got 19mpg for one that got 33mpg. I didn’t qaulify. Other people were buying cars and trucks that got 10mpg less than the one I was going to buy. I was also told by car dealers I know that only upper middle class and wealthy people had the money to buy ‘new cars” as ore-owned cars with great mpg did not qualify. Another giveaway to the rich,as it didn’t help poor people or lower middle class folks who are hoping to have a job at the end of the year.

In all, 84% of participating customers traded in pickup trucks, and 59% ended up with passenger cars. The other 41% was split up among crossovers, SUVs and new pickups. The Transportation Department says the program resulted in a 58% improvement in fuel economy for the new vehicles, as the outgoing models averaged 15.8 mpg while the new models averaged 24.9 mpg.

Top 10 new vehicles purchased

1. Toyota Corolla
2. Honda Civic
3. Toyota Camry
4. Ford Focus FWD
5. Hyundai Elantra
6. Nissan Versa
7. Toyota Prius
8. Honda Accord
9. Honda Fit
10. Ford Escape FWD

Top 10 trade-in vehicles

1. Ford Explorer 4WD
2. Ford F150 Pickup 2WD
3. Jeep Grand Cherokee 4WD
4. Ford Explorer 2WD
5. Dodge Caravan/Grand Caravan 2WD
6. Jeep Cherokee 4WD
7. Chevrolet Blazer 4WD
8. Chevrolet C1500 Pickup 2WD
9. Ford F150 Pickup 4WD
10. Ford Windstar FWD Van

Keep it in boost,
TurboT2

Cash for Clunkers