• Jul 9th 2009 at 7:40PM
  • 6
AutoblogGreen reader Michael recently sent in a question regarding the about-to-start "Cash for Clunkers" program. Officially known as the Car Allowance Rebate System (CARS), the program allows owners of some older and inefficient vehicles to trade them in and get a rebate check worth up to $4,500 from the government to buy a new car. The simple version of the rules are that the trade-in can't be more than 25 years old, needs to have an official combined highway/city fuel economy rating of 18 mpg or less (on the EPA's new mpg scale), be in drivable condition and you have to have owned and insured the car for at least the year prior to turning it in. Michael's question revolves around what happens when a car has two fuel economy ratings - one for gas and one for ethanol. Turns out, no one really knows yet. Find out more after the jump.

Photo by iboy_daniel. Licensed under Creative Commons license 2.0.
Michael's email read as follows:

I own a 2000 Ford Taurus Flex Fuel auto. The combined mpg for unleaded gasoline is 20mpg which is over the required minimum of 18 combined mpg for the cash for clunkers program. The E85 combined mpg is a combined 15mpg which is under the minimum of 18mpg combined. Is this vehicle eligible for the program?

We thought the answer would be no, the vehicle is not eligible, because CARS only counts the fuel economy number when using gasoline. The CARS FAQ page explains the qualifications this way:

How do I find out the combined city/highway fuel economy rating of my trade-in vehicle?

Go to http://www.fueleconomy.gov/feg/sbs.htm and click on the model year of your vehicle, the make, and then the model. Under the words "ESTIMATED NEW EPA MPG" in the red banner, there is a red number with the word "COMBINED" under it. That is the new combined city/highway fuel economy for your vehicle. You may then enter the make, model, and model year of a new vehicle you may want to buy and see its combined MPG for comparison.

When you follow the instructions, you see an image like the one above. For most vehicles, there is only one number that gives the gasoline rating. If that's under 18 mpg, then you're good to go. But, in Michael's particular instance, there are two ratings, one that would qualify and one that wouldn't.

We called National Highway Traffic Safety Administration, the organization responsible for implementing CARS, to get to the bottom of the story. The NHTSA representative we spoke to told us - repeatedly - that, if you claim that you've been using ethanol in a trade-in car that has an E85 rating that qualifies for the rebate, then, yes, you can get the multi-thousand-dollar voucher towards the purchase of a new car.

The bill authorizing CARS is H.R. 2346, which President Obama signed in late June, and the text describing the program can be found here. In this legislation, there is no mention of ethanol or a particular fuel type. Instead, it reads:

With respect to a new fuel efficient automobile, the number, expressed in miles per gallon, centered below the words `Combined Fuel Economy' on the label required to be affixed or caused to be affixed on a new automobile pursuant to subpart D of part 600 of title 40, Code of Federal Regulations.

Here's what the label looks like:

The EPA's regulations on how to come up with this number stipulate that it must "indicate the fuel economy of the automobile when operated on gasoline or diesel fuel." Therefore, we're pretty sure that CARS will only look at the gasoline number, and our friend Michael is out of luck if he was hoping to trade in his Taurus. Things could change, of course. The EPA told us that no one really knows yet what the rules are, because they are still being drafted. According to the Department of Transportation, the full rules of the program will be made public in late July. Stay tuned.

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    • 1 Second Ago
      • 6 Years Ago
      We should all be consistent in using the 18-mpg threshold for qualifying for the program. The writer first says, "fuel economy rating of 18 mpg or less," then later says, "If that's under 18 mpg, then you're good to go." Michael's email says "which is over the required minimum of 18 combined mpg," which is correct, except that 18 is actually the allowable maximum combined mpg. Less-than-18 versus 18-or-less...it makes a difference, and the legislation reads "18 miles per gallon or less." My vehicle rates a combined 18 mpg, and when I checked it on the Ford "cash for clunkers" site, it qualified for the "rebate," or, more accurately, a guaranteed trade-in value. A rebate is something you get back after purchasing a product, so we should not mislead people into thinking they're getting one, because they're giving something of value in return for the voucher. My vehicle is far from being a clunker, worth about $4,500 based on similar vehicles on Autotrader.com - I just wouldn't have to worry about selling it myself to get the current retail value, and I wouldn't even have to detail it! I'll never reveal that it actually gets 20 mpg combined. Sad to say, I won't get $4,500 off that new Hyundai Touring - only 26 mpg combined.

      Although the dealers will be required to see that the trade-ins are "crushed or shredded," the recycler can part them out and keep the change. Maybe the government should take title to the vehicles and sell them overseas, say, in China. All those empty container ships leaving US ports should take something to bring back a few of those billions we're sending over for all that merchandise stacked up at Wal-Mart and Lowe's. Wait...even if we don't send sellable vehicles to China, they'll still wind up there - as scrap metal. Wait for the horror stories about nicely-kept vehicles forced to salvage while people who can't even afford a clunker stand by and watch another government boondoggle.

      Federal rules likely will require purchasers to submit proof that the vehicle was insured for the previous year, maybe in the form of a letter from your insurance carrier. The companies will love to see hundreds of thousands of requests for verification documents coming in the next few months. Or will we just sign a government form with the usual fraud penalties? Notice that DOT will maintain a VIN database of all the new "fuel-efficient" vehicles we buy. They'll be tracking us - maybe to see that we don't turn around and quickly sell the new vehicle for a profit.

      Program rules have to be out in a couple weeks, so no public comment will be possible, at least on this funding increment. August through early November will see a spike in vehicle sales, then they'll crash in late November after the funding expires. I'd better take advantage of all these rebates, tax credits, and discounts so I can afford to pay the extra taxes we'll all have to shell out to pay for these incentives for ourselves.
      • 6 Years Ago
      I was wondering about this as my '01 S-10 is E85 compatible. using E85 numbers it qualifies easily, without it doesn't.
      • 6 Years Ago
      I never did get an answer from the governament regarding this program. I just went and purchased a Mini Cooper which gets combined mpg of 29 mpg to eliminate the issue.
      • 6 Years Ago
      Unfortunately, you'd probably have to prove that you had been using E85 for at least that past year, just like ownership and insurance.

      While many cars can run E85, few actually are filled up with it all the time. You have to remember that ethanol compatibility was used as a loophole from day one, allowing Detroit (and the rest) to crank out gas hogs and get a break on fuel economy rules. I think the big three lobbied as hard as the corn growers, knowing it would mean they could keep making big cars with low mpg numbers. Thankfully that loophole was closed some years back.

      Here's a link to a good pdf summary of closed cafe loopholes from back in 2005.
      • 6 Years Ago
      Since one of the points for initiating Cash for Clunkers was to put a small spark in new-car buying, I don't imagine legislators would want to outright eliminate E85 compatible cars from the equation. Of course, there would be other legislators who'd obviously wish you'd go out of your way to keep buying E85 ethanol, so...yep, complications.
      • 6 Years Ago
      This is very frustrating because we own a 2002 Dodge Grand Caravan (Sport) 3.3L that is the same way buy the dealership refuses to allow the E85 rating of 13 mpg for E85 and 18 mpg for regular unleaded. We have called cars.com several times and received several answers. The Kia Spectra that we wanted has a combine mpg of 27 mpg, so it's worth it for us to wait for an official answer (if we ever get one). I think Nissan is willing to work with us, so we may have to go with them. I wish that NHSTA would put something in writing on their website. I am happy to see that others are asking the same question, most people that answer the phones for this cars.com don't even know what E85 is and don't believe me when I say that I use it.
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