August 20th, 2009 at 07:24am
A few weeks ago I noted that the controversial Cash For Clunkers program was underway in the US, since then it has been embroiled in all flavours of fiasco. The US government so badly underestimated how many people would use it, that the program ran out of money within days, and the government hastily threw more money at it before they disappeared for their August holiday.
Back when I wrote that original article, I was contacted by an outfit called Donate Car USA who were informing me of some of the interesting pitfalls in the Clunkers program. I noted their email, but never got around to writing anything about it. They have since contacted me again, and updated their notes on the Clunkers program, and I think the information is worth sharing.
To qualify for the Clunkers program, you have to be both selling and old car, and buying a new car. In effect, you don’t actually make any money as the cost of the new car well and truly outweighs the cost of the old car. In addition, there are some interesting rules:
- Your vehicle must be less than 25 years old on the trade-in date
- Only the purchase or lease of new vehicles will qualify you for the federal funding
- Trade-in vehicles must get 18 miles or less per gallon
- Vehicles must be in driving condition, plus registered and insured for the full year prior to the trade-in
As Donate Car USA points out:
The gas mileage rates are so low that only very poor mileage cars like SUVs or trucks will qualify.
And if your vehicle happens to be worth more than the $3,500 or $4,500 rebate amount, well tough luck, you don’t get any government money.
The fact that the program ran out of money with such tight rules is extraordinary, and makes me wonder whether funds were reserved for each application, pending inspection of the clunker in question rather than only being allocated after cars were officially deemed to be clunkers…in which case I expect we will start to see a lot of people very upset that their car doesn’t qualify.
So what do people do if they want to get rid of an old car in the US, but don’t qualify for Clunkers, or don’t want a new car, or just don’t want to go through the hassle of selling. This is where Donate Car USA steps in, making it easy to donate a car, in some cases regardless of whether it is running, to a charity of the donor’s choosing.
Still, it’s a case of giving away something, which might not be an easy thing to do for many people, so they’re offering an incentive…from their website:
And to thank you for deciding to donate your car to charity, instead of participating in the Cash for Clunkers program — when you donate your car to one of our 400+ fine charities — just tell your operator you’d like the $300 Free Grocery or Gasoline Rebate when you make arrangements with us for the free car donation pick up.
Now that’s a charity which understands its target audience. The “what are we going to do with that car on the lawn” brigade who are probably struggling a bit with the economy in the shape it is, and unemployment heading the way it is…a large market of people who would probably like to help out someone else and be able to make their own lives a tad easier at the same time. It’s a darn good deal, and I haven’t even touched on the possible tax benefits yet.
I would strongly advise anyone in the US who is considering getting rid of a car which they may think is a “clunker” to check out Donate Car USA and see if it’s right for them. There’s a lot more information on there than I could ever hope to represent here, and one would assume that their staff can answer any outstanding questions.
Now, are there any similar programs in Australia? Somehow, I doubt it.