Cash for Clunkers: Too Good to be True?
June 28, 2009 by Mark Ellis
Filed under Business
President Obama signed the so-called “cash for clunkers” program into law this week, a federal program that will provide government subsidies for motorists to turn in old, fuel-inefficient vehicles and purchase newer, cleaner cars. The problem for many Americans, though, may be the government’s narrow definition of what cars qualify as clunkers.
As the program stands, 250,000 Americans will be able to take advantage of $1 billion in government funding to trade their old vehicles for new ones. In order for a vehicle to qualify as a clunker, it must be no older than 25 years old and achieve no more than 18 miles per gallon. The vehicle must have been registered to the same person for over a year and it must be drivable.
Furthermore, the car that is purchased must not be more than $45,000, and to get the full $4,500 credit, the purchased vehicle must achieve either five to ten more miles per gallon than the trade-in vehicle. Customers will not be able to get the regular trade-in value for the vehicle since the old one will be destroyed.
Clunker or not? (Image: Flickr)
