Friday, August 7, 2009

‘Cash for Clunkers’ cheated some who really needed it

I’ve heard enough about the “Cash for Clunkers” law to give it a “C-minus.”

The only reason it did not fail completely on the report card was because some consumers and companies used it to trade in a real clunker in the name of efficiency.

In this economy, who could blame someone for trading in a 1999 Jeep with 150,000 miles on it for the $4,500 rebate.

This law gets a C-minus because of what happens – or doesn’t happen – to the cars that are traded in.

If you haven’t heard yet, all cars traded in are to be destroyed and never driven again regardless of condition.

In other words, that 1999 Jeep could have made someone else happy further down the chain, but the dealers are required to pour silicon into the engine and render the car undrivable.

What if someone could have used that Jeep – let’s say in a rural area where a single mom could use a better vehicle to get to her job in a nearby town? The law says “too bad, so sad” to her and raises the overall demand and price for used vehicles.

This Wall Street Journal article further explains how the trade-ins are “killed.”

These cars are not even parted out, further depriving the industries that deal in used and reconditioned parts.

Wouldn’t “Cash for Clunkers” have been better served to recycle rather than completely destroy?

Could they not take a lesson from charitable organizations that deal in quality hand-me-downs? Aren’t we in a hand-me-down economy as it is?

I am curious about the carbon footprint involved with a perfectly good car that gets branded and scrapped as a clunker.

This clunker law needed a second tier, a Phase 2, to reach its true goal of efficiency and economic stimulus. It needed a hand-me-down clause because not all of the cars being traded in have been clunkers.

Heck, we have heard that people traded in restorable classic cars to take advantage of the rebate. Yeah, it made us a bit sick, too.

This law, with its flaws, has boosted some assembly line production at the automakers, but even that could be construed as a bailout.

Are the manufacturers going to use this boon to churn out a pile of 50 mpg cars? The answer is negative. The TV ads will still be there, telling us that 26 mpg highway is “great mileage” for metal, non-recyclable composites and batteries on four wheels. Where will these cars go to die when their time is up?

If the government tries again in the future with another clunker law, I hope they allow some of the passable used cars to help someone else further down the chain.

9 comments:

  1. Someone who is in dire need of transportation due to economic conditions surely do no need to be driving an 12 mpg vehicle at gas over $2 a gallon.

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  2. I know that I would drive some of the cars that are being turned in. I know as a truck driver's wife that some of these cars are better that some of the cars that some trucker's families are driving. That is "stupid" to not recycle these cars or sell them cheap to people that can not afford a new or newer car.

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  3. What a crying shame! All this talk about leaving a Carbon footprint is a big joke anyway. By trashing these cars kills any hope anyone ever had of getting a cheap car. Supply and demand will drive up the cost of any used cars that are left making it harder for people to buy them. Maybe that is Obama's goal to push the car market way up so he push his mass transit idea thus sticking something else in the governments pocket.

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  4. Interesting how our "daily driver" becomes a "clunker" virtually overnight. . .

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  5. I drive a 2001 Chevy Suburban with a 8.0l engine. I get a whopping 10 miles to the gallon. Why, WHY???, can't I just get an engine to replace the one that's in there??? We have always taken very good care of our vehicles and I have a hard time throwing it away for a Hyundai that will die before my Suburban will. I'm being factitious here but what kind of gas mileage will I get with a Hyundai pulling my Carmate trailer full of 55 gallon drums?? Probably about the same as my Suburban does...

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  6. According to cars.gov (http://www.cars.gov/files/TheRule.pdf) you can resell everything but the drivetrain. "The dealer must agree to transfer the trade-in vehicle to a disposal facility that will crush or shred it so that it will never be returned to the road, although parts of the vehicle, other than the engine block and drive train (unless the drive train is sold in separate parts), may be sold.

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  7. What the program is designed to do is to make sure that vehicles taken in are not put on the road again. The engine is seized up with a sodium silicate solution to make the vehicle undrivable, then the salvage yards have 6 months to crush or shred the vehicle's body. Body and interior parts can be removed by the salvage yards for resale.

    As a mechanic it's quite sickening to me to think about the number of good, usable cars that could have been sold to not-so-fortunate families who are not able to purchase new cars. This program is only helping those who could have already bought a new car without the program's existence and not those who need cheap, reliable transportation to go to work or look for employment during this crappy economy. I can see the justification behind destroying say, a 1984 Ford Econoline van that was rusting away and had a badly worn engine in it to begin with but not some of the nicer late-model mid-size cars, vans, and SUVs that were being killed off.

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  8. I would like to know how all these people are paying for these new cars when everyone out of work.. Too by destoring the cars what about ones who dont trade they will never beable to get parts. I drive a 2500 Gmc Sierra big V-8 no I dont get good fuel mileage but its paid for and I dont have a payment.

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  9. A small, temporary shot in the arm for the economy is going to ultimately result in nothing more than a kick in the arse in the end. Sell my clunker? Not. Both my vehicles are paid for and I am perfectly happy keeping it that way.

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