Possible new incentive

[Curtis]

The Cash For Clunkers program appears to have been signed into law, however still has a few hurdles to clear. Nay sayers claim it's another bailout geared to help American auto companies shed their gas guzzler inventories.

This program could contribute up to $4500 towards the purchase of your new Civic GX, in addition to the other incentives already available in your area. Principal of these is the $4000 tax Credit, and in my area, a $3000 grant designed to offset the incremental cost.

The program is set to kick off near the end of July and run to Nov 1st. Your current vehicle has to have been in your name and registered for the past year, average 18 mpg or less and, depending on what mileage gains the new car gives you, would get you either $3500 or $4500 towards the purchase of a new car... any new car.

I've attached a copy of the bill for your review. Google "Cash fro Clunkers" and you can get most of the details. You can go to www.fueleconomy.gov and check to see if your car averages over 18mpg. I believe the program only applies to cars less than 25 years old.

[Beej]

Re: Possible new incentive

Finally a positive spin on this bill.

And as I understand the program, these are vouchers, so there are no alt min tax worries. Pretty cool. This should make it easier for folks to get into a new GX.

[Curtis]

Re: Possible new incentive

President Obama Approves the Billion-Dollar "Cash for Clunkers" Act

President Barack Obama signed into law last week a measure that directs $1 billion toward rebates for U.S. residents who trade in their cars or trucks for new, more fuel-efficient vehicles. Although unofficially called the "Cash for Clunkers" Act, the title is somewhat misleading, as the trade-in vehicle must be less than 25 years old and drivable, and it must be registered and insured for the full year before the trade-in date. Instead, the Consumer Assistance to Recycle and Save Act focuses on fuel economy, requiring most trade-in vehicles to have a combined fuel economy of 18 miles per gallon (mpg) or less. On the other hand, the trade-in vehicle must be destroyed by the dealer, so people won't be trading in their new Hummers just to cash in on the rebate. The law is essentially focused on those driving inefficient, aging vehicles with little or no market value, encouraging them to buy or lease new, more fuel-efficient vehicles. The new vehicles must also have a manufacturer's suggested retail price of not more than $45,000, so people buying high-end cars can't cash in on the rebate. Rebates will be awarded directly to dealers, who will pass on the savings to their customers.
The U.S. Department of Transportation (DOT) calls the new program the Car Allowance Rebate System (CARS). It requires any newly purchased or leased cars to have a combined fuel economy of at least 22 mpg, while sport utility vehicles and small and medium-sized pickup trucks and vans (collectively called "category 1 trucks") must have a combined fuel economy of at least 18 mpg. But to earn the rebate, new cars must have a combined fuel economy at least 4 mpg higher than the traded-in vehicle. That will earn a $3,500 rebate, but to earn the full $4,500 rebate, the new cars must have a combined fuel economy at least 10 mpg higher than the traded-in vehicle. Category 1 trucks earn the $3,500 rebate for a fuel economy improvement of at least 2 mpg and a $4,500 rebate for a fuel economy improvement of 5 mpg or more.
Those looking to purchase or lease a new large pickup or van must be trading in a large pickup or van or an even larger work truck. The new large pickup or van must have a combined fuel economy of at least 15 mpg. The vehicles will earn the $3,500 rebate for a fuel economy improvement of at least 1 mpg and earn the $4,500 rebate for a fuel economy improvement of 2 mpg or more. Any heavy work truck traded in for a large pickup or van can earn a $3,500 rebate, regardless of the fuel economy, but the work truck must be a vehicle from model year 2001 or earlier. That same restriction applies to work trucks traded for new work trucks, but such trade-ins can only earn the $3,500 rebate if the new work truck is of a similar size or smaller than the old work truck. The act only allows $75 million for rebates on work truck trade-ins, but that still allow for trade-ins of more than 21,400 work trucks.
Depending on the average size of the rebates, the act provides enough funding for rebates on roughly a quarter million trade-ins. The rebates will be in effect through the end of October, or until dealers provide $1 billion in rebates, whichever comes first. The act requires the DOT's National Highway Traffic Safety Administration (NHTSA) to issue final regulations by July 24, putting the act into effect on that date. To support that extremely tight timeline, the NHTSA plans to publish a summary of the act in the Federal Register in the near future. Technically, the rebate takes effect today, but the NHTSA recommends that dealers wait until the final rule is issued to be sure that they don't provide ineligible rebates. The NHTSA plans to include a list of participating dealers on the CARS Web site, and also plans to list eligible vehicles, but until it does so, you can check the official fuel economy of vehicles on the fueleconomy.gov Web site. See the DOT press release and see the act, the NHTSA summary, and other information on the new CARS Web site.

[Larryect]

Re: Possible new incentive

I think the catch here is: What dealer is going to give you more then the government credit on a trade that they have to destroy? It sounds to me like it would only be worthwhile if your trade in is worth less than the credit. Am I missing something?


Curtis, can you tell me about this statement:

and in my area, a $3000 grant designed to offset the incremental cost.

Didn't the CA program expire in March? Or, are you referring to something else? I live in Corona.


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[Curtis]

Re: Possible new incentive

Dealers will pay "Scrap Value" for trade ins being destroyed under the Cash for Clunkers program. This obviously benefits you if your trade is less than the Gov't contribution to the deal. I expect that $1 will be the listed trade value in this instance.

As far as the $3000 I mentioned; This is an incentive that I created for residents of the Antelope Valley that reside within the Los Angeles County portion of the AV. I also created a $2000 incentive for the purchase of a new VRA and can obtain up to 50% ($2000 max) on used VRA's. Either of these will get you back a check from LA County within 30 days (usually). Both are grants, which anyone can work with organizations in their area to create.

[Larryect]

Re: Possible new incentive

Your THE man Curtis.

Thanks.

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