by IgnoranceIsBliss » Sat 01 Aug 2009, 16:46:17
Meanwhile, in Orlando, clunkers are getting turned in left and right.
Orlando $this->bbcode_second_pass_quote('', 'O')nce reports began flying Thursday night that the program was running low on cash, "it was chaos around here," said Chad Rogers, general manager of Classic Mazda in Orlando and Holler Hyundai in Winter Park.
Rogers says his two stores have done about 35 "clunker" deals this week, with many more expected this weekend. "It has definitely stimulated sales," he said. "There's no argument about that."
Officially known as the Car Allowance Rebate System, or CARS, the initiative is designed to help the economy and the environment by spurring new-car sales. Car owners can receive federal subsidies of as much as $4,500 for trading in their old cars for new ones that achieve significantly higher gas mileage.
Sue Ferrara-Harney, a 43-year-old medical technician from Orlando, said she will miss her 1991 Mercedes-Benz 560SEL, which was the company's flagship sedan and sold for about $80,000 when new. She will not, however, miss the average 14miles per gallon it got on the road.
She wasn't really planning on buying a new car, but the government deal "was too good to pass up," she said. So she traded in her Mercedes for a Nissan Cube, which averages 29 mpg.
Well, I guess her job as a medical technician is pretty secure...
$this->bbcode_second_pass_quote('', 'R')ichard Peine, 68, of Groveland traded in a 1993 Ford Aerostar minivan with nearly 300,000 miles for a new Nissan Versa. "CARS worked for me," he said, adding that he likely wouldn't have bought a new car without the rebate. "It forced us into action."
Nissan had a promotional discount of $1,750, "and the dealer helped out with another $1,000, so we got a very nice $7,250 reduction from a $17,750 price, leaving a $10,500 balance," he said, plus tax, tag and dealer fee.
CARS offers customers a rebate of $3,500 or $4,500, depending on the fuel mileage of the vehicle bought and the vehicle traded in. The government had figured there would be far more $3,500 deals, but the opposite appears true, one reason the funds are being depleted faster than expected.
Of the first nine CARS deals Riding did, only one was for $3,500, he said. It also appears that consumers are trading in vehicles that you might not expect to see in a "clunker" lineup, such as Ferrara-Harney and her $80,000 Mercedes. Rogers has taken in a BMW 635 CSi, as well as a couple of Jeep CJs and a Chevrolet Blazer K5.
Under the rules, the dealer must permanently disable the engine and then send the vehicle to a salvage yard.