Mechanics ensure (clunker) trade-ins will never hit the road again

[high density]

On Tuesday, dealers' showrooms continued to hum with new sales under the program, which is designed to stimulate auto sales and take inefficient vehicles off the road. Service departments and scrap yards also were staying busy.

Hutter and fellow mechanic Mike Rickards were decommissioning more than 100 old cars that had been traded in at Prime. The lot was filled with obvious candidates, such as the faded red 1987 Chevy Silverado pickup that had to be pushed into place, and the not-so-obvious, such as another Silverado – a spotless green 1997 model that Rickards said is a lot nicer than what he drives.

Hutter and Rickards drain the oil from each vehicle, then pour a sodium-silicate solution into the engine, the government-approved method of making sure no one will ever be able to drive it again. They drive each vehicle to its final resting spot on the lot and rev up the engine to work the solution into the crankshaft bearings.

http://pressherald.mainetoday.com/story.php?id=275011&ac=PHnws

I was wondering what would happen to the traded-in clunkers. I am sure dealers are happy they are legally obligated to artificially disrupt the supply of used vehicles, at least when it comes to the "not-so-obvious" clunkers.

[ejpoeta]

1. my husband told me this program would raise the price of used cars.

i asked him why because i didn't even think about it. i had assumed there would be a glut of used cars sitting on lots. i didn't know they were going to destroy the vehicles. so not only do the dealers get to sell cars, they get to destroy the trade ins, thus decreasing the used cars available... AND parts. because i guess the parts can't even be used either. what a shame.

[madokie]

2. I think your husband is wrong about it raising the price of other used cars

The idea is to get the vehicles off the road and replaced with more efficient new ones. Its working too

[SmileyRose]

4. this does not affect used car inventories.

if anything it will mean a decent used car sitting on the lot now will still be there in a few weeks or months when this hoopla is over - because those typically in the market for used will go new instead. If anything it will increase the supply of used cars, by virtue of them sitting on the lot longer.

[high density]

7. Given the cars being traded in, I think we are talking about the lower end of the used car market

The people that would be looking at these vehicles are shopping far outside of the price range of any new cars. A new car isn't even under consideration for them.

[Duckhunter935]

5. only thing that can not be used is the engine

The rest of the vehicle can be parted out for a certain number of days after that.

[abumbyanyothername]

14. This is the key to the program

to spur production of new cars, not just to get the old ones to change hands.

[Tesha]

23. All the parts can be re-used *EXCEPT* the engines. (NT)

[babylonsister]

3. Isn't part of the point of the clunker program to get the gas guzzlers

off the road? I'm wondering if usable parts other than the engines can be cannibalized for people looking for them.

[high density]

6. Yes, getting rid of gas guzzlers is part of it

However, if a person is already driving a guzzler and can get something better than what they've got in the form of a "clunker" that was traded in, I don't see how it's a bad thing to let them upgrade.

I'm sure junkyards will salvage everything but the engine block and its innards.

[ejpoeta]

8. i hope so, because some parts can be used on more than just the one model

depending. my husband would go to the junkyard to get parts for the explorer when we had that. i remember a long time ago going to a parts store that specialized in used parts. they were a lot cheaper and worked great. i don't know if that store is even still around. this was a long time ago.

[alarimer]

9. Do all those vehicles get $4500 on trade-in?

They should only get Blue Book value. That 1987 Silverado is probably worth $500 and the government should NOT be paying more than that. But it is good that they are being destroyed. I was worried that the car dealers (being rip-off artists generally) would find a way to keep those cars on the road by selling them at auction or to Mexico or something. My main beef with this program is that the government should not be paying people to buy cars. Sure they get a massively overinflated trade-in value but they have to finance the rest. More consumer debt is not good, no matter what it is for.

[high density]

10. They all get either $3500 or $4500 for the vehicle, toward a new car/truck

The real value of the vehicle doesn't matter.

[alarimer]

11. That's a rip-off then.

Taxpayers should not be footing the bill for that. That 1987 truck is worth only a few hundred, max. No one should get $3500 for it.

THIS is what is wrong with the program. It is a taxpayer ripoff. Buying bad, crappy cars at inflated prices.

[anigbrowl]

12. Newsflash: economic stimulus uses future taxpayer dollars to stimulate moribund economy now

Sure, we pay for it later. It's a kind of subsidy to get the economy moving again, your basic Keynesian economics. In this case the public work is in improving the average mileage and cleanliness of road vehicles. I'm OK with that and I don't even drive a car so I'll see no benefit at all.

[MadHound]

13. It is a classic Kensyian economic stimulus

Government pays out a couple, three billion, stimulates demand in the auto market. Dealers hire new help, as do junk yards, recycling centers, steel mills, all up and down that economic chain. Those new workers, with paychecks in their pockets, go out and buy other things, stimulating more demand and growth, etc. etc., rippling throughout the economy and lifting all boats.

In case you hadn't noticed it, we're in a pretty damn deep recession, and our economy needs some stimulus. This is great program that accomplishes several goals, and we all benefit. But let me guess, you'd rather have that money spent on tax cuts, the least efficient way of stimulating the economy:eyes:

[backscatter712]

21. Exactly right.

The government's not in the business of buying used cars - this program is a tool to get used cars off the road, and they put provisions to see to it that these cars are taken off the road, permanently. On top of helping the environment, decreasing our reliance on foreign oil, we're spending this money to give the economy a shot in the arm, and that money will be paid back down the road when the economy recovers and tax revenues start rolling in again. Basic Keynesian economics.

[dysfunctional press]

16. educate yourself.

you're sorely in need.

"It is a taxpayer ripoff. Buying bad, crappy cars at inflated prices."




we're not buying the cars based on blue-book value hoping to resell them and make a profit.
the aim of this program has two parts- to help stimulte the economy in a VERY DEEP recession, and to get low-mpg cars off the roads, and more high-mpg cars on the road- in the face of both global climate change and peak oil.

[4lbs]

17. As a taxpayer, I like it. Why? Because the avg increase in mileage from old to new is about 10mpg

That will lessen fuel consumption, make for a cleaner environment (also because 2009 cars have better catalytic converters than 1989 cars), and so far, is getting those big SUVs and trucks off the road.

Ever try to drive behind a big SUV or truck while you are in a sedan? You can't see around them at all. Thus, you can't see what the traffic is like hundreds of feet down the road, and prepare for any stops. You have to rely on the driver in front of you.

[mkultra]

20. thats right, Its a buyup of consumer "Toxic debt"

cares that people have been sustaining and polluting with are now gone. Swapped out directly.

[NightWatcher]

15. that sucks, I'd love to pick up a clunker truck for use around the homestead

carrying the occasional lumber or supplies that dont fit in the Corolla

[MadHound]

19. Well, given that less than a million cars, out of over sixty million on the road are being traded in

I think that you can still find that "clunker truck" at a cheap and easy price.

[Spike89]

22. The number being destroyed is low, relatively

There will still be plenty of clunkers available. Used car inventory is reportedly in excess of 60 million units and so far less than 250,000 clunkers have been slated for destruction. The reality is that many/most of those clunkers are going to be near wrecks. Only an idiot dealing with an idiot car salesman is going to do the CARS program on a trade-in that is truly worth anything near the $3500/$4500 guaranteed. If a car is worth $4,000 on a trade-in, the dealer knows they can buy it for $4,500 and resell it for at least $5000, they at least break even and don't have to mess with the paperwork and destroying the car. Likewise, why in the world would you rush out and trade in your $4,000 for that extra $500 of trade-in when you can get that kind of deal anytime?

[mkultra]

18. or parts for existing clunkers will be cheaper.