House narrowly passes scaled-back 'Cash-for-Clunkers' legislation
After the House and Senate agreed on the terms of a cut-down version of the Cash for Clunkers legislation, it passed the house on Tuesday by a narrow margin (226-202) after being added as a supplemental appropriations bill to continue funding the wars in Afghanistan and Iraq.
Per the previous agreement, the new bill only contains $1 billion for the program, about a quarter of what was originally proposed, and will only extend through the 2010 fiscal year, ending on September 30.
The $3,500 and $4,500 vouchers for consumers remain intact, along with the 18 mpg provision, and there's a movement underfoot to get the legislation prolonged passed the 2010 fiscal year. The Senate is expected to vote on the bill later today and if all goes well, it should land on the President's desk this week.
[Source: Automotive News – Sub. Req. | Image: Theo Heimann/Getty]
Reader Comments (Page 1 of 2)
akboss302 10:33AM (6/17/2009)
I get the point, but by the time its done, and like all these things, red tape will take the budget way past the anticipated $1B.
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Saxxon 9:52PM (6/17/2009)
The dancing idiot and his henchmen in Washington just spend, spend, spend. Meanwhile, the Chinese continue to sell our Treasury bonds because of fear of the American dollar losing its value, because we are spending too much! This of course leads to our dollar losing its value globally, as well as locally.
Ever heard of the Wiemar Republic that controlled Germany between the first and second World War? They tried to spend their way out of the recession caused by Germany's loss during WWI. It didn't work. Soon people where seen taking wheel barrels full of money to by a loaf of bread because of the dramatic rise in inflation.
How much longer folks before we all are living this way?
Jei 10:45AM (6/17/2009)
My big question is:
Do consumers receive the voucher on top of the trade-in value of their current vehicle? Not in place of...
For instance - I trade in a 6 year old SUV that gets 15mpg. The SUV is still worth $15,000 as a trade-in. Would I still be eligible to get a voucher for $3,500+ on top of being able to use the trade-in value to help offset the purchase of my next (higher mpg) vehicle?
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modena360 10:48AM (6/17/2009)
i'm pretty sure you don't get a voucher on top of your trade in value. the car that you trade in is turned in scrap. therefore, it no longer has any value.
this program is only worth utilizing if the value of your trade in is way below the voucher amount.
Jei 10:53AM (6/17/2009)
And....
How far will $4,500 go towards a new more fuel efficient car if the average consumer can afford to maintain a $350/month car note.
I guess to maximize the govt voucher and protect yourself (and credit), I could trade in the old 92 Buick LaSabre (not worth the $250 she paid for it)-. Then take her to the nearest Hyundai dealer to get her an Elantra or whatever. And if she loses her job by downsizing, then she can give it back and find another clunker.
Jei 10:55AM (6/17/2009)
@modena360:
You're right. I read another article about the new Bill that indicates that no trade-in value would be possible if qualifying for the govt voucher.
Nightcrawler 12:02PM (6/17/2009)
"How far will $4,500 go towards a new more fuel efficient car if the average consumer can afford to maintain a $350/month car note."
It seems to me it would go a decent way toward that goal. You could get a pretty decent small car (say a Civic, Corolla, Elantra, Focus) for $18,000 easily. $4500 is 25% of that vehicle's cost, that's pretty significant. And most car have rebates at the moment which would drive the cost down even more.
To make up an example, $18,000 car minus $1000 rebate minus $4500 cash for clunkers equals $12,500 to be financed. Let's assume you finance for 60 months at 5%, your monthly payment would be $250 a month, not $350.
$250 a month is not an inconsequential amount of money to be sure, but it's within the range of a lot of potential car buyers I'd guess.
TheCleaner 1:35PM (6/17/2009)
why would you go though, from paying nothing a month with your old car which was paid off long ago, to $250 a month for 5 years. No matter how bad the mileage is, or even the service costs, its not going to be adding $250 a month, every month, over a new car.
Still, I dont disagree that getting $4500 worth of discount for a car that might be worth a few hundred $ is excellent, but who is in the market for taking on a car loan for the sake of fuel economy these days...
trax4wax 6:31PM (6/17/2009)
The Cleaner...
I don't mind making a car payment when my 93 v6 camry is on it's last legs and ready for the scrapyard anyway. I haven't made payments on it in 11 years and I won't mind taking up those reins again. The fact that I was going to get a car anyway, an extra $4500 on top of the $5000 I was already going to put down is even more reason. I'm the type that will.
Rochester, NY 10:44AM (6/17/2009)
From my last understanding of this bill, you have to have title for 120 days to qualify. Since the bill runs out Sep 30th, that pretty much excludes anyone from buying a clunker for the sole purpose of trade-in.
That rather sucks.
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Nightcrawler 11:52AM (6/17/2009)
Unless it's changed in just the last few days, you need to have the car registered and insured for one year before it was eligible. I tried to look up the text of the current bill today based on your comment, but what I found still says 1 year, not 120 days.
I seem to remember a much earlier version might have had something like 120 days. Is the number you are quoting current or something from a few months ago?
Rochester, NY 1:03PM (6/17/2009)
That 120 days thing... I got that months ago. Apparently it's become even more restrictive.
(sigh) There's just no way for me to use this Clunker Bill to my advantage. It seems specifically targeted for people hanging on to gas-guzzling junk because they can't afford to do otherwise.
You know, it seems to me more of a stimulus for Hyundai and Kia, than it is for domestics.
tankd0g 2:41PM (6/17/2009)
Yes, this bill will screw you over while a guy sitting on a lot full of clunkers he's had more than a year could potentially clean up. I have no doubt someone is going to find a way to game half that billion dollars for themselves.
Brent 10:56AM (6/17/2009)
Too bad my Neon gets decent gas mileage.
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TigerMil 11:03AM (6/17/2009)
DOA in the Senate.
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Nightcrawler 12:05PM (6/17/2009)
I hadn't heard that, but I hadn't heard anything saying it was likely to pass either. I really haven't seen much either way.
Would the fact it's tied to a "must pass" war appropriations bill make it more likely to go through? Or would that just mean they'd vote to strip Cash for Clunkers from it before they passed the was appropriations part?
John P. 11:08AM (6/17/2009)
Well it looks like just one more way the govt. took what was a pretty good idea and made a huge bureaucratic ball of hassle, rules and regulations out of it. Bravo!
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Richard S. 11:16AM (6/17/2009)
I am sure the mob is salivating the prospect of getting into getting clunkers exchanged for new cars but rather than scrapping the clunker, they will ship it to Mexico and get a mob-affiliated crusher to say that the car was disposed.
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Jimbo 11:27AM (6/17/2009)
How does the 2010 fiscal year END in 2009? I can understand the 2010 fiscal year STARTING in 2009, but ending? That doesn't make much sense.
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From My Cube 11:35AM (6/17/2009)
when was the last time the government did anything that would make sense