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Goodbye, guzzlers

Thousands tap vehicle rebate program

Jim Schierholz, 77, looks over his new vehicle at a Toyota dealership in Gladstone, Ore. Schierholz turned in his Econoline van for a rebate toward the purchase of a Toyota RAV4 as part of the federal government’s CARS program. Associated Press photos (Associated Press photos / The Spokesman-Review)
Jim Schierholz, 77, looks over his new vehicle at a Toyota dealership in Gladstone, Ore. Schierholz turned in his Econoline van for a rebate toward the purchase of a Toyota RAV4 as part of the federal government’s CARS program. Associated Press photos (Associated Press photos / The Spokesman-Review)
Dan Stumpf Associated Press

NEW YORK– Car and truck owners looking to junk their gas guzzlers are flocking to dealerships to take advantage of the government’s “cash for clunkers” program and buy more fuel-efficient vehicles, boosting sales in showrooms across the country.

“It’s water to thirsty people,” said Dave Kelleher, owner of two Chrysler dealerships outside Philadelphia. He said the number of shoppers has more than doubled at one of his dealerships and is climbing at the other.

“The last two days have been ripping,” he said.

The program – officially called the Cash Allowance Rebate System, or CARS – took effect over the weekend at the nearly 20,000 car dealers who have signed up with the U.S. Department of Transportation. The program offers rebates of $3,500 to $4,500 for car shoppers who scrap their old vehicles to buy ones with better gas mileage.

Jim Aten, 68, was at a Toyota dealership in Gladstone, Ore., where he used the government rebate to get a peppy new Scion xB. The car gets about 28 miles per gallon on the highway compared with 17 for his old Ford Starcraft, a monster of a vehicle.

Without the incentive “I would probably keep driving it,” Aten said. He said he was concerned that the government was spending money on the program, but acknowledged, “Maybe it will jump-start the car industry a little bit.”

Congress passed CARS earlier this year to help boost flagging sales and get some of the filthiest cars and trucks off the nation’s roads. Nationally, new vehicle sales are down 35 percent for the first half of the year, and the downturn has been devastating for automakers and dealers alike.

Here are the program’s rules: The trade-in vehicle must be a 1984 model or newer and must get 18 mpg or less in the government’s combined highway/city ratings.

Buyers can get $3,500 for a new car if it gets at least 4 mpg more than the old one. That rises to $4,500 if the new vehicle gets at least 10 mpg more.

For SUVs, pickup trucks or minivans, owners can get a $3,500 rebate if the new vehicle gets at least 2 mpg more than the old vehicle, $4,500 if it gets at least 5 mpg more.

Congress has set aside $1 billion to remove about 250,000 vehicles through CARS. As of Tuesday, the government had dispensed about $17 million, for 4,026 new vehicle sales, according to the National Highway Traffic Safety Administration. More than half were cars; the rest were pickup trucks, sport utility vehicles and vans.

The program ends on Nov. 1, or earlier if the money runs out.

Some industry watchers are skeptical the program will do much to lift auto sales.

The auto Web site Edmunds.com said that in any given three-month period, Americans trade in about 200,000 vehicles worth less than $4,500. That means, given the program’s 250,000-vehicle cap, it will spur only 50,000 additional car sales.

“The incremental sales will be limited and at a considerable cost,” Edmunds CEO Jeremy Anwyl said.

“We are paying consumers to do something most would do anyway.”