Hammer Time: New Clunker Law Makes This the Best Time to Buy. I Guarantee It!
Everyone asks me when is the best time to buy. Well . . . this may truly be it. The whoredom that is our federal government has decided to put a magna cum “clunker bill” on the front burner. If you’re fortunate enough to have a vehicle that is 2001 or older, you have a clunker. At least according to the wise and impartial souls promoting this legislation. Although the original offer was $10K smooth per vehicle only a few months ago, the amount has now gone down to $5K and a little cash for the “un-American” manufacturers as well. Will it go down? Well, I don’t know. But this is how I would play it.
Find what you want and make the dealers an offer they can’t refuse. Sure, you have to dicker and dicker. Get the price down and do not ever go to the dealership. You can do it by e-mail. fax, or heck . . . I’ll do it for $200 a pop. Speaking of which, I would definitely play this as an option trade.
When you finish negotiating the price make the option offer. Tell them you’ll honor the deal if the “clunker bill” passes and comes into effect in the next sixty days, and give them a $200 deposit as consideration. If they balk, walk. If they want it . . . draw a brief contract stating the SPECIFIC vehicle you want (including the VIN number) and have both parties sign the terms. Have a witness there and ask if a notary would be available if you’re really paranoid.
Congrats! You have now drawn up an options contract. You’ll have $200 at risk and as much as $5000 to gain from the puppeteers in charge of our affairs. Now about the price of industrial commodities . . . .
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I had a similar idea to Mr Lang, but one difference - I'd ask the dealer to give me the deal NOW! I don't see that a dealer has any incentive to wait. My concern is that once C4C passes, the dealers will be flooded with buyers (relatively speaking) and the willingness to "deal" will be gone. Many people already report that dealers are far less willing to negotiate than you'd expect. With C4C they will be looking to make all their money back... They'll gladly give you back your $200 to sell the car to someone else. Contract? They don't even honor their OWN sales contracts, why would they worry about honoring your back-of-a-napkin deal? Go ahead and sue - you're at the end of a long line of creditors. Even more worrisome, there are 4 versions of this bill floating around, and nobody has any idea how it will end up. Domestics only, US content minimums, less cash for foreign cars, fuel economy thresholds? The ideas are all over the place... how would you even know the car your are bargaining for will be eligible? Unless is was a pure, US-made, domestic badged, 40 mpg plus vehicle. In my scenario, I'd basically just be negotiating with the dealer to massively over-pay for my trade. They know how to do that. I'll get the car I want, they'll book a sale today, not in June... and I'm sure they can figure out how to unload my car on Uncle Sam when and if C4C passes.
I agree with Dweezil this is a stupid attempt this time by Congress and not Detroit to bring sales forward instead of addressing the real problem. The over capacity and the fact we have 1 or 2 too many in the Big 3 is the big problem that isn't address by this. After the buying spree ends and everyone has their new car that was part paid for by the taxpayers what sort of genius legislation are they going to pass the fix the market crash then. Typical stupid politicians. I wouldn't mind dumping this 200 Caddy I have with this Bill but I'm not buying another pile of Detroit junk to do it.
Along the lines of what Golden2husky said... Cash for Clunkers needs a couple of serious adaptations to recognize the embedded energy in existing cars. Subsidizing building new cars for marginal energy savings is not good enough. "Good enough" excludes wasting money propping up an oversized car industry. One improvement would be for the program to take the perfectly good used older cars given up by owners under the program, and trade these desirable clunkers, for free, to people who drive very little and have less clean/efficient cars. Scrap the worst of them. There is no sense in scrapping perfectly good cars for people like my father who drives his Cougar 2000km per year. The second alteration would be to spend the same amount per car to do FREE upgrades to clean/efficient power plants for owners of qualifying perfectly good older cars. There could be a huge number of good jobs created doing this, at low cost per job, and save energy at the same time. And then there are people who are sticking electric drive systems in completely ordinary cars/pickups. Why not help them out?
Dear Steven, There are plenty of good deals out there to be had without the need to make buying a car so difficult. Dealers are in business to make money. Lets not loose sight of that. You want them to be there when you need service, right?