By on April 20, 2009

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 . . . .

Get the latest TTAC e-Newsletter!

38 Comments on “Hammer Time: New Clunker Law Makes This the Best Time to Buy. I Guarantee It!...”


  • avatar
    no_slushbox

    The only part I question is this:

    “Have a witness there and ask if a rotary would be available if you’re really paranoid.”

    Rotaries are known to be VERY unreliable, a notary would be much better.

  • avatar
    beller

    $200 per pop……that’s not bad. Are you a professional car purchaser? I may be interested in your services.

  • avatar
    no_slushbox

    Yeah, $200 isn’t bad at all. Even if you think you are a good negotiator, there is the old saying “A lawyer who represents himself has a fool for a client.” Taking the emotion completely out of it is valuable.

  • avatar
    gamper

    I would be interested to know exactly how to qualify for this tax credit. Do you have to buy a brand new 2009/2010vehcile? Do you have to have owned your clunker for a set period of time, because this seems ripe for abuse if I can just go buy a junked car and get the credit.

  • avatar
    superbadd75

    So what’s the plan for all of these “clunkers”? In my eyes, a 2001 model vehicle is still reasonably new. If they’re well kept, why would they be taken off the road? It seems to me that a better idea would be to offer this to pre-OBDII cars, or maybe 10+ years/110k+ with emissions issues (check engine light on). I’d hate to see perfectly good later model cars go to the crusher just so some politicians can make themselves the saviors of the economy. A 2001 Taurus, for example (pictured?), with decent miles would make a great car for someone that can’t afford to finance something, but I guess the current crop of geniuses in D.C. can’t see that. They’d rather attack a problem that isn’t really a problem just for show.

  • avatar
    golden2husky

    *sigh* what a waste. Years of improving the long term durability of vehicles only to crush them before their time. Here is a way to make this a little better. All the cars that are traded in should be evaluated and those that are serviceable should be saved. Part out the true clunkers. What to do with the saved cars? You know there are poor people out there with true clunkers – the gross polluters that smoke and leak for years before they finally get junked. When a poor guy’s car fails it’s inspection, scrap it and give him one of the program cars. If you must dabble in this this clunker crap, at least someone in need gets a better/safer car and you actually address a real source of pollution. Yeah the devil’s in the details, but if we can negotiate terms of ballistic missiles, this should be a piece of cake.

  • avatar
    eggsalad

    Hm, so my 1984 Volvo wagon, which cost $17,995 in 1984, is now worth $5000? That’s not too bad, as far as depreciation schedules go.

    If the $5k offer is only good on “American” cars. I’m off to the Pontiac dealer to pick up a base Vibe (that’s American, wink wink) for $11,110, and add the $1500 rebate, bringing it under 10 grand plus tax. Forget the sales tax, Uncle Sam is refunding that on the tax return.

  • avatar
    Steven Lang

    Eggsalad… you scare me.

    That would be the EXACT model I would be considering. That and the G8 would be at the top of my list.

  • avatar
    no_slushbox

    eggsalad:

    I think it is by domestic content, not badge, so a number of cars with “foreign” badges should also qualify. And things like the Aveo/G3 and G8 won’t.

    Although at the end of the day I highly doubt that any restrictions on origin will survive. Restrictions on Canadian and Mexican made cars definitely won’t survive.

  • avatar

    I think my dad’s Jeep Grand Cherokee is a 2002 model, so it misses the cut, barely.

    Funny that, my parents had a good run with Chrysler products. Between my mom and dad, they drove a mid-’80s LeBaron convertible, a ’91 Grand Caravan, and a ’99 Intrepid, plus the Grand Cherokee. Aside from regular maintenance, and the Grand Cherokee’s taillights burning out a couple of times, there were no problems whatsoever. I always wonder why people say Chrysler builds shitty cars, then…

  • avatar
    eggsalad

    @no_slushbox

    Okay, sure… but really (and I’m no expert on what’s made where these days) the Vibe/Matrix twins at around 10 grand strike me as one of the better bargains out there. But I’ll take any other interesting ideas in 4-cylinder, 5-speed, 5-door cars you’ve got.

  • avatar
    ajla

    @gamper:

    From what I’ve read:

    The car has to be registered and “drivable”. To qualify the vehicle also has to get an EPA combined score of 18MPG or less. To get the full amount the trade has to be year 2000 or newer, with1998 and older cars have a payout progressively less down to $2000.

    The vehicle you buy has to get a combined EPA score of at least 25MPG (maybe stricter). You can buy a used car, but the amount you get is reduced. You are also restricted to using the program only once per year and three times while the program is active.

    There are lots of varying proposals in Congress (and they all have some type of strings attached). but the gist of all of them is that one can’t turn in a rusting on-blocks Pontiac 6000 for $5000 and then go out and buy a Challenger SRT8.

  • avatar
    eggsalad

    @alja

    Yeah, I figured $5k on a 1984 would be too good to be true. And since my 1984 Volvo 245 Diesel came with a combined mpg of something in the high 30’s (35 city/41 hwy), what’s the point?

  • avatar
    Demetri

    I’m really going to hate this if it passes. What a way to screw over everyone who bought a new car in the past year. If you’re going to throw money around, fine, but make it available to everyone.

  • avatar
    windswords

    I know how you feel ferrarimanf355. I have owned an 86 Laser, 90 LeBaron convertible, 94 Grand Caravan, 97 Stratus ES, and 2003 Dodge Durango. No major problems with any of them. But it’s popular to bash Chrysler vehicles right now.

    Now, with a name like ferrariman I have to wonder; have you have had experience with the mechanical ups and downs of Italy’s finest?

  • avatar
    dwford

    Cool. I have a 92 Mazda ready to go. Too bad I spent so much on maintenance over the years…

    Strangely it passes emissions even though it smells like gasoline is pouring out of the tailpipe.

  • avatar

    windswords, to answer your question, no. However, where I live (Jupiter, Florida), there’s quite a few Ferraris driven on the streets. A couple of 360 Challenge Stradales and 360 Spyders are commonplace, which makes sense since there’s a racetrack (Palm Beach International Raceway) nearby.

    The only experience I have driving Ferraris is in video games. Which reminds me, I should play a few more rounds of OutRun Online Arcade tonight…

  • avatar
    confused1096

    Hmmm…If this passes my ’01 Windstar is gone within a week of it being enacted. Five grand is more than I can currently trade this thing for.

  • avatar
    Dynamic88

    I’m going to play it this way – instead spending thousands just to get the cash from the govt., I’ll just hang on to my long payed for ’98 model, which still has plenty of life in it.

  • avatar
    ravenchris

    The puppets in charge of our affairs…

  • avatar
    no_slushbox

    eggsalad:

    My point wasn’t that you shouldn’t get a Vibe or Matrix, it was just that you could get either one since they are built in the US (and most likely have enough domestic content). You don’t need the Pontiac badge. Although it will probably get you a much better price.

  • avatar

    windswords, I forgot to mention this before the edit function expired, but there’s also a Lamborghini dealer nearby, in West Palm Beach, a couple of blocks from a Rolls Royce/Bentley dealer that has a used Ferrari 599 GTB Fiorano. Also on the same street is a Maserati dealership and a Land Rover/Aston Martin dealership

    I don’t think my dad can use his clunker to get a Quattroporte, no?

  • avatar
    Hippo

    If you can use the 5K to buy a decent car like a Honda, then it might be a deal.

    The crooks at the 2.x will make the rebates disappear the day the 5K come into play, so the sheep will be paying the same as always for the junk and think they got a deal.

  • avatar
    ohsnapback

    Okay, so this will be the finest sausage of legislation.

    Mmmmm….tasty lips and arseholes in this bill. I can smell the aroma.

    The value of pre-2001 gas pig junkers just doubled.

  • avatar
    peterb

    At least in its original incarnation, the clunker offer was limited to purchasers who made less than $25,000 AGI (if single) or $40k AGI (if married).

  • avatar
    Kman

    Up here in Canada a similar scheme plan is being discussed, though at least it would be for 10+ year old cars.

    I find a few ironies in these plans, but we all may be wrong, as apparently this has worked in Germany to relaunch the stagnant retail car industry there.

    Nonetheless, I see these ironies:

    – As stated previously, there would have to be good details around this. I have my old ’92 Integra sitting rotting in the back lot (not running)… can I cash *that* in? I’m assuming there will be some parameters around having been registered and on the road for so long, etc…

    – The bigger irony that I still haven’t resolved: If I’m hanging on to a clunker, then I’m not exactly financially well-placed for a new car purchase. If my car is ready for the crusher, I’ll probably be upgrading to a $2,000 runabout. I don’t see how this works, other than abuse.

    Hm, just did some simple division. Remember the $750 billion bailout of the banks last fall? (I.e. the Bush-era, no-oversight-pay-yourselves-bonuses bailout)

    Take $750 billion, divide by 125 million cars (about half the US car population I believe), you get….

    $6,000 per car.

    If we’re spending money, that’s an incentive that makes sense.

  • avatar
    npbheights

    About that Dexcool Disaster Suburban I have…

    I CAN DUMP IT without feeling guilty about selling it to an unsuspecting victim! The Federal government has already lost billions on GM’s debt service and obligations, why not loose some more billions on overpaying for lots of 8+ year old GM products? Maybe the task force can use this opportunity to do some research on the Company we just ‘bought’ and check out some of the trade-ins and get a real feel for GM quality. I suggest they start by opening the radiator caps…

    Sweet! Lets see, since January 20th a major road in my town is being redone with Federal Infrastructure Stimulus money, I am getting Federal rebate money to replace my 12 year old central air system in my home with a much more energy efficient model, i am going to get extra tax incentives to pursue my masters degree, and I can get $5000 toward a brand new car in trade for a worthless GM vehicle? Awesome! I guess it true, if you want to live like a republican, vote democratic. Unfortunately, when you start printing money, either by giving it to the rich ( tax cuts and an easy lending induced asset bubble) or to the middle class (consumption incentive, ie: tax rebates and spending) the currency is what ultimately suffers.

    The only memorable thing that transpired in the previous administration’s first year in office was in mid september of that year, though…

  • avatar
    Rod Panhard

    I think there’s a contest here, waiting to happen, Mr. Farago. “Who has the crappiest car that’s worth the most money in a clunker buy-back?” We’ll need to see paperwork, but it could be a hilarious thing to watch, since we’ll soon have one less auto manufacturer to watch melt down….or not.

  • avatar
    DweezilSFV

    All this does is pull forward a bunch of sales, artificially stimulating the car industry and once the incentives run out, car sales dry up again, production drops, red ink flows , dire consequences ensue. Lather rinse repeat.

    Nice to see the government trying “new things”. Just wish they’d stop cribbing their ideas from GM

  • avatar
    ccd1

    As the proud owner of a 1999 Toyota 4Runner with 150,000 miles, I am eagerly waiting to see how the Clunker Bill turns out. My bet is that Congress will screw things up and my clunker will stay in my garage. Reason? Congress seems to be trying to marry improved gas mileage with saving Detroit. Detroit got into their mess, in part, because they based their auto plan on SUVs and ignored small, fuel efficient cars. If I end up limited to a Detroit hybrid, I just may continue to pollute the earth.

  • avatar
    windswords

    ferrariman,

    I live “up the road” from you (Jacksonville area). One of my favorite baseball players, Mike Schmidt is retired in Jupiter. I wonder if one of those exotics you see belong to him?

  • avatar

    Honestly, I don’t know. I know Tiger Woods has a house in the area, maybe it belongs to him. Now that he’s no longer a spokesgolfer for Buick, who knows what’s in his garage?

  • avatar

    If the cash-for-clunkers passes without origin restrictions, I might have to forget about the Ford Fiesta I’ve been lusting after and get into a Honda Fit, unless Uncle Sam wants to keep the program open for about a year. It’s not like it would be a big loss, the Fit is a marvelous car, but I’m rather looking forward to the new Fiesta.

  • avatar
    Steven Lang

    I wouldn’t mind doing a top ten ‘clunker’ list. Even though my definition of that is far different from the Feds.

  • avatar
    RetardedSparks

    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.

  • avatar
    Redbarchetta

    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.

  • avatar
    brandloyalty

    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?

  • avatar
    buddytrunick

    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?

Read all comments

Back to TopLeave a Reply

You must be logged in to post a comment.

Recent Comments

  • Kendahl: Outside of normal maintenance (tires and battery), the only things that have broken on our Focus are the...
  • MrIcky: This study needed more information. I wonder if some of the cost involved is basically paying for techs to...
  • Nick_515: A bureaucratic approach like this can ONLY lead to the RAV4 of the category… which is the IS250....
  • cimarron typeR: From your list I’d go ATS, I was lucky enough to test drive a manual 2.0t sedan. Handled as...
  • ajla: 0. The 2.5L Lexus V6 is direct injection only and suffers from VW-level carbon issues. I’d research and...

New Car Research

Get a Free Dealer Quote

Who We Are

  • Adam Tonge
  • Bozi Tatarevic
  • Corey Lewis
  • Mark Baruth
  • Ronnie Schreiber