The Car Allowance Rebate System, informally called “Cash for Clunkers,” was passed by Congress in June to help jump-start struggling auto sales and to improve the environment according to ABC News. There were many critics at the time that thought the effects of the program would end up being unfavorable to the economy in the long run.
So what really is a clunker? UsNews.com defines the clunker as a drivable car made within the last 25 years, which does not exceed more than 18 mpg. To learn more about the combined city/highway fuel-economy of your car, check out the official FuelEconomy.gov’s side-by-side comparison of your car versus a less efficient vehicle. A few benefits of the program were reducing gas prices, minimizing harmful emissions in the environment and even the occasional drop in monthly car insurance prices. To get a free auto insurance quote, visit www.safeauto.com.
Those who participated in the program this past fall traded in their old cars towards the purchase of new, more efficient automobiles. The program was set up to run from July 1 to November 1, or until the state issued $4 billion to support the program ran out.
The environmental idea behind the bill is that it takes old, inefficient vehicles off of the road. But some environmentalists were actually opposed the bill because it took still very functional cars off of the road before their time was up. The bill did not permit those involved with the program to use the vouchers towards used vehicles, even if they were more fuel-efficient!
So where are the clunkers now? What are the fates of the perfectly still functional SUVs and minivans that could be beneficial for those not in the market for a new car? Read this article from USA Today that states concern that the price of used car dealers are now at a threat of raising prices since most of their new inventory they would be receiving are being scrapped in accordance with the Clunkers program.