Last night, I watched a Flood Automotive Group TV ad touting “Cash for Clunkers.” The message was simple: Uncle Sam’s got $1 billion for clunkers. Come get $4500 for your clunker. Not a single word about which vehicles qualify for the money. It didn’t even refer viewers to a website for details—like this ad for C4C “designated” dealer Phil Fitts Ford. A quick ring ’round twenty dealers nationwide shows a definite “reluctance” to discuss the particulars of the CARS program over the phone. “I’m sure your vehicle will qualify,” a Chrysler dealer told me re: my theoretical 2005 Chrysler 300. “Bring it down and we’ll have a look.”
“We haven’t received the guidelines yet,” a Chevy dealer said, in response to “how much money can I get for my 2002 Honda Civic?” Only one dealer said my non-applicable vehicle was non-applicable. In other words, thousands of car dealers are ready, willing and able to commit the sin of omission; luring old cars owners to the dealership with the prospect of “free” government cash—for which the customer’s vehicle doesn’t qualify.
Then there’s the other “danger.” What’s to stop dealers from saying “Well, your wreck doesn’t qualify for the government program, but I tell you what, WE’LL give you $5000 towards a new Enclave”? I heard those very words from the mouth of a mid-Western Buick dealer.
The DOT is making sure that traded-in clunkers qualify for the federal rebate. They’re doing their level best to ensure that the culled clunkers are disabled. But who’s watching dealers at the sharp end, protecting consumers against the same old fraud and misrepresentation? The same people doing it now. And look what a great job they’re doing.
While I applaud the DOT for their Herculean efforts to create a new, effective, efficient and ethically-administered federal program, and I’m a firm believer in Caveat emptor, CARS puts some of America’s most economically challenged consumers in the dealer crosshairs. Again.
I’ve seen an ad Nissan’s running that advertises new Altimas for $13K and change “with government voucher” (their exact words). They don’t bother to explain what that voucher is, or what you have to do to qualify for it. I’m sure there will be more than a few pissed customers who’ll show up expecting to get a cheap Altima and instead get a rude surprise.
Then there are the dealerships who advertise a car at a ridiculous price “including applicable incentives” (which include the C4C money). I can’t help but wonder what’s going to happen when someone shows up with a non-qualifying car (or without a trade at all) and finds out that price just went up by $4500.
And car dealers wonder why the average consumer views them with utter comtempt and puts car shopping in the same category as dental surgery.
The dealers are using it for the same purpose as the politicians did in Washington in creating it – it is purely a marketing tool.
For the dealers, it is to get you to the dealership. I have to say, that many car buyers don’t actually know what model year their vehicle may be, and advertising is to get you to the dealership.
The politicians – buying votes and giving the appearence of “doing something”. So most people won’t benefit or qualify – see above about how uninformed most people are.
I’ve also started noticing ads in the paper touting $9000 Nissan Cubes. Only in the small print do you find anything about C4C, and even then it doesn’t give any guidlines as to what would qualify.
Both your theoretical 300 (assuming it is a V8 model) and your theoretical Tahoe would qualify for the program. Would the actual trade in value most likely be higher than the voucher value? Of course, but given the right mix of mileage and horrible condition some people might get more out of the voucher on those vehicles.
There is also some truth to the no final guidelines statement, as from they way I have read the law, the government does have until the 24th to make changes before it becomes final.
Aside from the fact that it is much easier to sell a car in person than over the phone, dealers have very good reasons to get the customer to bring the car into the showroom to be looked at before promising a certain amount. A surprising number of people don’t know what model year their vehicle is or don’t know what engine it has in it, both are critical pieces of information in determining its eligibility status. Add to this the insurance and ownership requirements, and it is better to get them to bring it in to work it out than promising money over the phone, only to find out it doesn’t qualify when they arrive, and having to deal with that nightmare.
As far as what the Buick dealer told you – what is wrong with that statement? If a vehicle doesn’t qualify, the dealer can still use rebates and discounts to lower the price of the vehicle they have to sell. In fact, that is exactly what the guy told you, even saying up front that it didn’t qualify for the government program. Are dealers supposed to tell you ‘Sorry, doesn’t qualify, we can’t sell you a car’ ?
NulloModo
My bad (early AM). I asked about a 2002 Hond Civic TOWARDS a Chevy Tahoe.
Text amended.
You must be educated as a consumer, or be a mark. Dealerships do some messed up things to drive traffic to their showrooms, and the best weapon with which to protect yourself is knowledge. On one hand, there is no excuse for dealerships to be underhanded and use trickery to sell cars. Then on the other hand, in this day and age where any information you want or need is but a few keystrokes away, there is little excuse for ignorance. Bottom line, I do not excuse the dealers that are trying to screw people over, but the blame can at least partially be placed at the feet of the people being screwed for not doing their homework. The government isn’t there to protect the lazy and the moronic.
I’m curious as to what effect this will have on resale values. The way I see it, everyone potentially qualifies for these credits (and the original incentives on top of the Federal voucher). So doesn’t that mean EVERY car on the road (or at least every new car sold during this program) should automatically be discounted and devalued by $3500-4500 forever? Say someone buys a Hyundai Accent for $5500 ($10,000 – the $4500 credit). Well, the car depreciates for three years and say they go to sell it, and the KBB value is $3600. So that means I should offer them only $100 for their car.
The fact that you can’t touch a super-duty 4×4 truck for under $42,000 (a guesstimate, b/c I’m too lazy to price out all the different trucks) is ridiculous. The prices for most new vehicles are not reasonable, and temporary smoke-screen tactics, and shallow discounts may move some of the moribund metal, but will not help valuation of these vehicles down the line.
From what i’ve seen, the majority of cars on the road wont even qualify for C4C. My coworker asked me if his 98 Mystique would qualify, i told him i didn’t know, but doubted it since it was a 4 cyclinder. I was under the impression most the cars on the list are like old Town Cars and Deville’s and not economy cars. Sounds like they just want to get big guzzlers off the road even if you want to get rid of an economy car to get an even more economical new car.
I see nothing wrong with the dealers trying to get you into the dealer with talk of rebates instead of the C4C. It’s their job. And without checking KBB, i’d think an 05 300 would be worth more than $4,500. Unless it’s got 200K miles or something, not that i’d ever expext a Chrysler to go that far.
C4C was bought and paid for by dealers, so they’re going to use it to the max.
That video made me sick to my stomach. It is just a marketing ploy for the scum to pull out their bag of tricks to play on the general public. Yes I understand about buyer beware, however people don’t buy cars that often so no matter how smart a guy thinks he is, in reality he’s like a lamb dealing with wolves. I can still say that myself after my fifth new car purchase (sigh). The next one is going to be a long time from now.
I admire them for trying with that video.
Here’s a list of the vehicles my wife had before I started working full-time at the auto auctions. See if you can spot the clunker.
1983 Lincoln Mark VI (4 door)
1983 Lincoln Mark VI (2 door)
1986 Toyota Camry
1996 Dodge Grand Caravan
1997 Ford Escort
re: Steven Lang:
1996 Dodge Grand Caravan – new enough and low enough mpg
the age restrictions do add another level of confusion
Face it, dealers are desperate to get you on the lot. So I would expect more of the old hard sell bs, especially from a Chrysler dealer.
I actually got a bit of a chuckle out of the video, it probably would have been better if it was half as long though.
Like Robert says above Caveat Emptor, which was, I believe the name of the first Roman used chariot dealer.
I have several problems with CARS program. Let’s not even address the main question why Uncle Obama should be giving away down payments to new cars, but look at the nitty gritty instead.
Why did they pick 18mpg as a cutoff point and accepting 22mpg as green cars,WTF? Those seem very, very modest goals for saving fuel.
Seems like requiring the new car to get 30mpg would be reasonable and accepting any car into the program as long as they get an improvement of 10mpg would not be unreasonable.
But that would probably limited the most of the expensive cars from the dealership lot, hum, could it be that we are trying to save something other than the environment?
Even though I swore I would never even consider a new car, I might find my self on the way to the dealership if our beater would qualify for the program. 21 mpg according to EPA is too “efficient” to qualify.
The C4C requirements are interesting. The New York Times profiled a guy who will be participating. Did he have an old Town Car, Caprice or Ram? Nope…a ’96 Saab 9000CS automatic. According to the CARS website, this car supposedly has a combined 18 mpg, however in the real world it gets well over 30 on the highway, and way over 18 combined. My 5 speed 9000CS doesn’t qualify, because of it’s lofty EPA-estimated 21 mpg combined. Real world, I’m getting 30-31 in mixed driving. So, the dude above could potentially get $4,500 to trade his worthless (but fuel efficient) Saab for a new (but less efficient) car. Loony.
You know you’re a hard-sell, throw-the-keys on the roof car, olde skool dealer when…
When the sales manager cuts a video with his sales board right behind his head.
When the place is so cheap, the computer on the F&I manager’s desk is so old it runs on MSDOS.
When your closer has a mini fan on his desk to keep him dry while the customer sits and sweats in the literal “hot box.”
That’s a great video. I especially like the one about how your kids ask you to drop them off two blocks from school.
Any new program invites opportunities for graft. Just ask the GAO about military projects.
No consumer should think they’re getting a straight deal at a car dealer, particularly when the government is involved.
You’re right. We got the GC when my wife was 8 months pregnant with kid #2. It averaged around 20 mpg which is more than the Windstars and Freestars my wife drove once I started selling cars on the side.
Massachusetts law prohibits merchants from using “bait and switch” tactics. They may not advertise one product and then try to steer consumers to another product by refusing to show the advertised item, dispariging it or it’s warranty or failing to provide a legally sufficient quantity. Under MA general Laws Chapter 93A and 940 CMR 6.06 a seller may be guilty of false advertising ( or of bait and switch tactics) if it advertises a particular item and then fails to provide sufficient quantity to meet reasonable demand. The ad must clearly state limited supplies and that no rain checks are available. It can offer a comparable substitute or it can prove shipping delays.
This is precisely what happened to me today at a KIA dealership. When I purchased the Boston Herald that afternoon the ad still appeared. It is dissappointing that NONE of the dealers were able to produce a vehicle at the advertised price.