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Smart Shopper Cash for Clunkers - Does it Work for You?
2647 messages, Last post on Oct 01, 2009 at 6:33 PM
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I Traded My Clunker and Bought a....?
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Replying to: srs_49 (Sep 21, 2009 4:03 am) I stated.. My income doubled in July and Aug over what it had been the prior 8 months. Ditto all my fellow sales people, F&I guys, aftermarket ladies, aftermarket vendors, truckmen, distribution people, etc, etc etc. If my income doubled .... Uncle Sam's income doubled too I should have stated that 'Since my income doubled in these two months then Uncle Sam's collections from me and others who benefitted from the program also increased similarly.' You're right the annual receipts for the IRS didn't double and even the monthly receipts didn't double. But the monthly and quarterly receipts to the IRS from those involved in the program did jump significantly for those two months. That's money that the IRS wouldn't have otherwise received if not for the C4C program. |
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A vehicle at 15 mpg and 12,000 miles per year uses 800 gallons a year of gasoline. A vehicle at 25 mpg and 12,000 miles per year uses 480 gallons a year. So, the average clunker transaction will reduce US gasoline consumption by 320 gallons per year. They claim 700,000 vehicles – so that's 224 million gallons /year. That equates to a bit over 5 million barrels of oil. 5 million barrels of oil is about ¼ of one day's US consumption. And, 5 million barrels of oil costs about $350 million dollars at $75/bbl. So, we all contributed to spending $3 billion (of Taxpayer money - - appropriated & spent by Congress !!) to save $350 million. and On the other hand, most of the clunkers that were traded in probably wouldn't have lasted through 10 years and likely would have been traded in for ... drum roll ... more fuel efficient vehicles. Break even can be elusive. I don't argue with either of the above, but .... You're making the assumption that the clunker was being driven 12K miles per year. Many of the clunkers that were traded may have been 2nd or 3rd cars and not had that many miles put on them. Now, they've been traded in for cars that get much better mileage, and the new cars may now be the primary vehicle for the family. Now, the annual savings is less than $350M per year. I agree that the point of the C4C exercise was to give a shot in the arm to the manufacturers and dealers, not to save money in reduced gas consumption, but there are too many variables to accurately calculate any sort of dollar savings in consumption. I'm just sayin' 
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Replying to: michaell (Sep 21, 2009 1:10 pm) THOUSANDS OF OBAMA BUMPER STICKERS REMOVED FROM THE ROAD.
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Replying to: euphonium (Sep 21, 2009 2:41 pm) 
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Replying to: michaell (Sep 21, 2009 1:10 pm) Using C4C, the Explorer is traded for an Escape Hybrid getting 28MPG. The Escape becomes the primary (14K MPY) and the Malibu becomes secondary (7K MPY). Gas usage before: 14K/24 + 7K/14 = 1083 gallons/year Gas usage after: 14K/28 + 7K/24 = 791 GPY That's 292 gallons saved. Not far off from the 320 gallon derived above; less than a 10% difference. That's also, at current prices, around $800 per year that the consumer saves on gas. Also, few would argue that maintenance costs on the new car will be dramatically less than the clunker so the consumer saves even more. Those savings will be reinvested in the economy by either being spent (driving the retail economy) or saved/invested (driving the financial industry). I'm guessing for many it would be saved/invested since it seems the bulk of the C4C transactions were for cash so the buyers would want to rebuild their investment portfolio. |
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Replying to: michaell (Sep 21, 2009 1:10 pm) That describes me. I commute in my Miata but my minivan still gets 10k miles per year at least.
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you forgot 1 aspect. Who says they wil lbe saving $800 a year, since they have to pay the 20K+ for the new car somehow. That, and I imagine any clunker was running liability insurance only. At least in NJ, going to full boat insurance will cost more than the gas savings!
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Replying to: ateixeira (Sep 22, 2009 7:40 am) I don't know about that, sometimes you just end up with an extra and it is not worth getting rid of it. We have 3 and do not drive a lot, my wife and I only put 7000 to 8000 miles per year on each of our main cars. The extra (coulda been a clunker) minivan does not get driven much at all by us. Since it is not worth much, we just keep it to have around for carrying stuff maybe 1-3 times per year and make it available to our 3 adult children in case they have problems with their cars (or want to use one temporarily in the case of the one that does not own a car). |
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Replying to: stickguy (Sep 22, 2009 8:13 am) Only if the new car cost $24,500 or more after discounts and the $4500 credit. Focus, Civic, Corolla - many cars well below that cost. ... I put that many miles on my 3rd car (minivan) and neither of my kids are driving yet! |
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My CPA bought a new Sonata. He went in and looked at them the end of July. The showroom was crowded and he decided to come back after he went to a conference. When he went back in first part of August the price was higher and the selection slim. He found out the C4C program caused all the problem. He still bought but was miffed at just another waste of tax dollars as he put it. He really likes the car in spite of it costing him about $1500 more than it would have in July.
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