Cash for Clunkers Turns 15. Did It Do All It Was Supposed To? (No.)
I climbed behind the wheel of a used but loaded four-door Ford F-150 XLT pickup. It had a 5.4-liter V-8, an engine about which a mechanic friend once said, “If every vehicle came with that motor, I’d be out of business.” I checked the air and the heat; both worked. The stereo sounded good. The interior was clean.
I drove it from the back of a GM dealership to a bay in the service department. The automatic transmission shifted properly, the power steering worked, the brakes were fine. I pulled it into to the bay and handed the keys to a mechanic. He drained the oil and replaced the plug.
Then he prepared two quarts of a special oil replacement that was 40 percent sodium silicate and 60 percent water. He poured it in and started the engine. The mechanic gunned the accelerator a few times, then kept the truck idling at 2000 rpm. After about six minutes, the engine began to falter, and the mechanic applied more throttle to keep it at 2000 rpm. Soon the engine shook, rattled and died.
The truck then sat for an hour as the solution hardened. I was shaken more than I expected I’d be—this truck was nicer than the pickup I had at home that I used to tow my race car. To purposely kill it just seemed, well, cruel.
But that’s what the Car Allowance Rebate System, or CARS—known nationwide as “Cash for Clunkers”—did to 677,081 vehicles in the summer of 2009. Hard to believe it has been 15 years since the federal government funded the $3 billion program, and it has been essentially forgotten. But it was big news in 2009.
The economy was grim, with the auto industry hit especially hard after overproducing and underselling. (One Ford executive wryly confided that they were losing money on a bunch of sales, “But apparently we think we’ll make it up in volume.”) Chrysler filed for bankruptcy on April 30, 2009, with General Motors filing a month later. They got an $80 billion bailout from the federal government. Compared to that, the CARS allocation was pocket change.
But if CARS took more than 677,000 vehicles off the road, then it had to put 677,000 brand new ones back on it at a very dire moment for Detroit. New-vehicle sales were suddenly robust. Customers, trading in “gas guzzling” clunkers, got a credit on newer, more fuel-efficient vehicles. You had to buy a car with an EPA-rated fuel efficiency of at least 22 mpg, which got you a credit of $3500, or 28 mpg for a credit of $4500.
For the story I was working on, I went to multiple new car dealers to look over the collection of trades they’d taken with CARS. But there were awfully few legitimate gas guzzlers. Yes, the government said they had to average 18 miles per gallon or worse to qualify, but given the type of job the vehicle was built to handle, 18 mpg may not be so bad.
At the first lot, a Ford store, doomed CARS trade-ins included two Chrysler minivans with V-6 engines, and a very nice Ford Windstar minivan with a V-6, full leather interior, a six-disc CD player, and what appeared to be brand-new tires. Three Ford Explorers with V-6 engines, two Dodge Dakota pickups, two six-cylinder Jeep Cherokees. There was a clean Jeep Grand Cherokee Laredo with the 4.0-liter six-cylinder engine and a new set of Michelin tires, which alone probably cost at least $500.
And there was a white-over-red Ford Mustang LX convertible with a white leather interior. With a 5.0-liter V-8, it met the 18 mpg threshold exactly. Cash for Clunkers vehicles, by the way, had to be drivable—you couldn’t push your car with an already seized-up engine to the dealer and expect to participate.
I saw no land-yacht station wagons, no runout full-sized vans, no Chevrolet Suburbans, even. Relatively few of the Clunkers were, well, clunkers. The Obama administration, which backed the legislation, took it on the chin for that. Said the right-leaning Cato Institute: “Suppose each clunker was worth $3000 at a guess, that would mean that the government destroyed $2.25 billion of value.”
“Destroyed” is a bit of an overreach. Car recyclers had 180 days to part out the clunkers if they wanted, with the exception of the engine, which did have to be destroyed. (Break the rules, and there was a $15,000 fine.) Some proponents of the program complained about this—why let them sell parts if it just helps more clunkers stay on the road?—but a lot of the CARS trade-ins did indeed go straight to the crusher. A car’s engine is the most valuable piece of the vehicle to recyclers, and some passed on participating in CARS at all because of the limited amount of money they could make selling fenders off a Grand Caravan.
CARS began on July 1, 2009, and ended on August 24, after the $3 billion was exhausted. Congress originally appropriated $1 billion, figuring it would last until winter, but the money went so fast they had to ante up another $2 billion.
I followed that Ford F-150 to the salvage yard, where it was delivered the next day. Turns out they had plenty of F-150 parts and didn’t need any off this truck. It would go straight to the crusher in a few days, flattened and placed atop of a stack of crushed vehicles that looked like toy cars a child had stepped on.
Did I want to come back and watch? I did not.
Periodically, there has been talk over the years about bringing CARS back, but it appears to be one and done. In many respects, CARS played a successful role in preserving the American automotive industry; it did give the economy in general, and the auto industry in particular, a shot in the arm at a critical time. And, statistically, it did raise the average fuel mileage of the American fleet.
But did it take “clunkers” off the road? In a word, no.
It was a joke. Plenty of decent cars got destroyed. I wonder how much was just wasted. Did it help some people buy cars? Yes.
Joke? It was a SCAM perpetrated by the carmakers.
The article states ” Chrysler filed for bankruptcy on April 30, 2009, with General Motors filing a month later.” If the N.A. auto industry failed, a lot more than the price of used cars will be the fallout.
100% Right.
It was a s am by the government.
It was. Scam by politicians protecting their investments in the auto industry. Follow the money.
Spot on. CARS was yet another socialist manifesto designed to fail. Let alone how it ruined the affordable used-fixer-upper market. However, if you speak to someone from Washington D.C. they would likely feel this was a feature not a bug.
Socialist? The government keeping private capitalist industry privately owned and operated hardly sounds socialist.
In 1975, the British government nationised British Leyland to prevent its collapse and subsequent loss of jobs. That’s socialist.
And look how that turned out!
Every time governments interfere in business and the economy they fail and wate tax payers money
Correct-the British motor industry is gone, bought up by foreign interests. At least some of the manufacturing remains. Small consolation.
You know it really gets my goat, I bought a pick up two years ago. I’m not gonna say what kind, that SOB does not get 16 miles a gallon. Sure maybe on the highway but riding around town and doing shopping and being on interstates for a short period of time the damn thing does not get 16 miles a gallon. How is that? My friend bought a ram and he said the same thing he said he doesn’t get 15 can’t understand crushing cars they got better gas mileage and yet they’re still making these gas hogs. I had an 85 Oldsmobile cutlass that got like 23 or 24 miles a gallon on the highway and just under 20 going back-and-forth to work makes no sense.
It hurt people who didn’t have the money for a new car by making replacement parts scarcer.
I didn’t see any discussion here of the foreign cars that got better gas mileage that were sold to replace the American cars that were turned in. Since most sold cars were Japanese, I think C for C helped the Japanese economy more than ours.
And yet the American auto industry is still around. Building better cars than they did in 2009. Doesn’t really seem like that much of a failure. Had G.M. and chrysler collapsed, it would have taken Ford and the hundreds of suppliers with it. Would have added to an already depressed economy thanks to banking deregulation
The gov’t could have done a lot more towards reducing carbon emissions by putting all sizes of non-commercial vehicles under the same emissions standard, or alternatively, charging taxes on personal vehicles that rose with gas consumption. And/or with mass. Had they done so, there would be fewer behemoths on the road, and fewer peds, cyclists, and drivers of smaller, more efficient cars being killed or injured.
I’m still driving my ’08 Civic (stick), that weighs only 2,600 lbs, and gets close to 40 mpg on the highway. It has 166k on the clock.
Nice classics in the photo of “clunkers” waiting destruction: a ’65 Pontiac Tempest, and a mid-1960s Lincoln Continental. What a shame!
“or alternatively, charging taxes on personal vehicles that rose with gas consumption. And/or with mass.”
The Congresscritters can’t do that, that would be taxing themselves. Back before the oil embargoes in the early 70’s the annual license plate renewal fees in Illinois for the small, fuel-efficient “econo-boxes” were only half that of the big cars. During the embargoes and their resultant gas shortages, the Illinois legislature came up with the idea of a gas-guzzler tax, but apparently someone realized “we can’t do that, that’s what we’re driving.” The bill that came out the other end raised the fees for the small cars to the same as the big ones.
Up until last year I was paying the same amount for the plates on my ’70 VW Karmann Ghia convertible as for my V8 F-150. (Actually, I was paying $7/year more for the VW because it had personalized plates.)
Illinois plates back then were based on a road horsepower formula. I don’t know the formula or the hp cutoff, but a Mopar 225 c.i. Slant six was $15 and the Chevy 230 c.i. six was $30. It was not a policy to encourage economical cars-the split pricing predated econoboxes-but was instead an increased tax on what were more expensive cars at the time the practice initiated.
Fast forward to 2020, however: Illinois enacts a $100/yr surcharge on electric vehicles “in lieu of road (gas) taxes”. Quite the incentive to get people to reduce their carbon footprint, no? At the same time, the Illinois EPA offers a $4000 rebate for the purchase of new and used EVs, excluding motorcycles ($1500). A couple of potential pitfalls, in typical Illinois fashion: funding is capped at $12 million/year, and lower income (less than 80% of the Illinois median gross income) applicants are prioritized. In other words, buy the EV and hope you get the cash.
The formula is Bore squared times the number of cylinders divided by 2.5
I knew someone out there would know it!
They should tax EV’s yearly. It’s been proven they are heavy and do damage to the roads. Without the fuel tax for the roads they should not get a pass just because it’s electric.
The top row in that photo, from the Camaro(?) convertible to the Dodge van looks like the line-up at our local 4th of July parade. Even now, when I see cars like that rotting in a field, I think that if they survived this long, they deserve resurrection. No, I can’t afford the car or the restoration, but at least there’s hope.
I spotted a 1984-1988 Toyota 4×4. in 84-85 the Yota had a solid front axle. That used set up will go for about $1,500 today. Who is the idiot that got rid of a Yota 4×4??? Unbelievable!!!
Come on it wasn’t a joke it saved the auto industry and got a lot of junk off the road honestly if you don’t drive a mopar it’s all junk best program ever
Yes, it helped some people buy cars… With Taxpayer money.
Another fiasco from (P)resident Obeyme.
Legislation signed by Obama, sponsored in Congress by both parties.
This is neither support nor condemnation of Obama. Like it or not, both parties share in the blame or credit (depending on your opinion) for the program.
677000 sales, spread amongst all the manufacturers (many of which would have happened without the program), probably didn’t help the manufacturers. Remember, though, dealers were suffering mightily at that time as well. Sales drummed up by the program probably helped many dealers survive.
Nobody really knows, just a thought I haven’t seen discussed here yet.
I took advantage of the program, which prompted me to trade a true clunker in on a new Pontiac. It allowed me to put my son in a safer car than the car I traded in. In all it was great for me. Overall for the country, probably not so much.
Yet another boondoggle cooked up by the Ivy-League educated DC political class. The long-term result: the average age of the U.S. vehicle fleet has risen from about 10 years in 2009 to almost 13 years in 2024. Brilliant. Our tax dollars at work!
And the poor had to deal with a tighter and more expensive used car market.
Yes, I’m solidly upper middle class but I’d definitely be in the market for many of those wastefully destroyed vehicles.
Republicans in congress didn’t want this program so they made that law so convoluted that vehicles that were not gas guzzlers were included and some that were were excluded. .. go figure!
Sorry to burst your highly partisan bubble, but the senate was split 49 49 with 2 independents who I believe caucused with the Dems and congress was 233-198 in favor of the Democrats. It wasn’t until midterms in 10′ Republicans overwhelmingly took the house with CNN openly crying over it on air. Everything of that era was Democrat including every bit of the cash for clunkers. No republicans were necessary to pass anything.
110th 2007-2009 100 49 49 2 – 435 233 198 – 4
Non-partisan here…neither of you has bothered to cite sponsorship of or voting split on the bill.
I can’t find the voting split but the sponsor in the House was a Democrat and sponsorship in the Senate was bipartisan.
Fact, not opinion.
Your own set of “facts”
Look it up: the House sponsor was Betty Lipman (D-Ohio) and the Senate sponsors were Debbie Stabenow (D-Michigan) and Sam Brownback (R-Kansas).
I assume you have some other “facts” on which you challenged my assertion? Or did the truth just get in the way of your opinion?
All from states that have car assembly lines
Pretty to be expected.
As a native Kansan, I’m not aware of any car or truck assembly lines in Kansas.
GM has a stamping plant in Fairfax which is on the Kansas side but not “car assembly.”
Most of the Kansas City plants are much like the Chiefs NFL team and despite the state name in the city, the city is in another state (Missouri.)
The website “GM Authority” lists Fairfax #2 as an assembly plant, building the Chevy Malibu and the Buick LaCrosse in 2009.
Interesting. Thanks for the clarification.
Can’t rewrite history in an attempt to make your comment turn from BS to Marigolds…
How did the program raise the average age of the fleet? I’m confused.
I was wondering the same thing. Perhaps the real reason is that the overall quality of vehicles has improved since then.
… quality improvement?
Ford didn’t get the memo.
LMFAO (Insert laughing smiley face emoji here).
Over time the average age went back up. The program was a short term solution. I’m definitely not helping the average age, seeing how my daily driver is 22 years old.
Glad I didn’t turn my ’86 C20 in…. although that $4,500 was much more than it was worth at the time. It was painful to see the decent vehicles being junked. What a huge waste of my taxpayer money.
Adlen Wrecking yard is long gone. It’s now a storage lot for totaled vehicles awaiting auction or such.
Who made all those ” Clunker ” decals? Were they mandatory? If so, who got the contract to manufacture them? Was it a government contract? Were they all scrapped along with the cars? If so,why did they leave them on cars destined to be scrapped instead of using them again? Are there any ” CLUNKER ” decals left? What is an original clunker decal worth? Does anyone sell reproduction clunker decals?
All of the ones shown in the photos above have California plates, and the caption on the top photo says it was taken in Fairfield. It wouldn’t surprise me to find that all of the decals were made for a single dealer out there. We didn’t see any on this side of the country.
The green/white “Clunker” on the windshields are the work of a window painter. All are slightly different but very artistic.
if my memory is correct – that was the time when the economy really did tank very badly, and as a result new car prices went very low – so low a brand new base 2 dr F-150 could be bought very cheap back then, supposedly at way less than dealer cost, and even less than the $13k tooth implant with bone graft that my dentist said i hadta get at that time instead – ouch! PS – i still got that necessary tooth implant, but will always miss that shiny new Ford pickup that i never got instead, way back in those good old days. PPS – that unfortunately murdered F-150 clunker in the article above also sounded pretty good, too.
Yes, there were deals in large/thirsty vehicles in 2008! A lot of people forget that gas prices spiked in 2008 with a peak in July, just before the bottom fell out of the stock market in September. That put downward pressure on transaction prices even before the government/Federal Reserve financial bubble fully burst.
Biden was in charge of updating the website for Obama. The numbers never balanced out.
The gas price spike up was part of that green mindset that went forward without acknowledging the infrastructure backup required to support it.
Gas prices spiked in 2007-2008, reaching a peak of $4.11/gallon in July 2008, before the 2008 elections and well before the change in administrations in January of 2009.
I can’t find anything about Biden being assigned to updating the website (presumably the C4C program website). Perhaps you can point me in the direction of that info?
I bet your dentist bought a new Mercedes.
It was a sop to the auto industry and to people wealthy enough to buy and finance new vehicles. And it hurt the poor that regularly buy and use sub-$5000 “clunkers” for transportation. It took 677,000 good used vehicles out of circulation and raised the prices of remaining used cars.
Basically Obama messed over poor people.
And killed Pontiac….
Yes
Congress makes these decisions and provides the funding, and Congress was Republican at the time.
As pointed out above, this is dead wrong. Dems controlled the house by a wide margin.
Also as stated above, the legislation had bipartisan support.
Dems wrote the bill, but funding to process the paper work and data processing was NOT in the bill. Because of this, processing was assigned to FAA in OKC. FAA employees were paid time anda half overtime. A total wast of money, IMO.
As above, the bill was sponsored by members from both parties.
Congress doesn’t fund anything, we the burdened taxpayer does all the funding. It is all about spending other people’s money, it’s what they do.
Yes I agree I was selling at a dealership that sold only trucks , big and small, at the time so we did not get any clunkers.
My trade was indeed a clunker: a rusted 1978 Buick with 185K on the clock, a bad lock-up torque converter and a cold-start hesitation bad enough to be a true safety hazard. It had reached the point where shouldn’t have been on the road.
And I bought a Pontiac.
A ‘78 Huick didn’t have a lock-up torque converter. I had a Regal and a Lesabre and neither had them.
Oops Buick
Correct. It was a 1985 LeSabre, 307 Olds, four speed automatic. 1978 was a typo (or brain fart, I’m not sure which).
Thanks for pointing that out.
Those were great cars, last of the true full size before GM did the major downsizing. I agree that your old Buick was the perfect candidate for the program. Old, tired worn out and inefficient. You would never get $3500 selling the car unless there was $3000 cash in the glovebox. It was truly a shame to see vehicles with plenty of life left in them get destroyed (point of the article).
Agree
An aqquaintence turned in a reasonably reliable Dodge Caravan and bought a Kia Soul – what a screw up that was. She encouraged me to turn in an older BMW and get ‘something new’. So glad I didn’t do that, as the BMW now has 250,000 miles on it is running strong.
And it wasn’t the only disaster foisted on the country by that Obama guy; the Affordable Care Act was neither affordable, nor provided quality care to those in need.
The President signs into law (or vetoes) legislation forwarded to him by Congress. In this case Obama signed into law a bill sponsored by members of both parties. Calling C4C a bipartisan disaster would be more accurate.
Commentary on the Affordable Care Act Care Act probably belongs in another venue.
Aw, seeing some of those C/K trucks and Ford pickups makes me sad. I bet the guy that cashed in on that 1980s or early 90s Land Cruiser wishes he could turn back the time.
I worked at a Lexus dealer at the time and someone traded in a very clean Cadillac with the Northstar V8. I was told to “silicone” it. I told them to get someone else to do their dirty work, that i couldn’t do that to such a nice vehicle!
This was the beginning of the lack of cheap transportation. It was a waste of government money.
But 85% of the cars scrapped were cars not suited for the roads. But many of the parts could have been used to repair other cars more affordably.
The politicians want us all on public transportation. Just look at the cities. 4 lane toads now 2 lanes. Bike lanes in parts of town they will steal your bike plus six months it is too cold and snowy to bike.
They also want you in a walkable city an not in the safe suburbs.
This is why I worry about autonomous vehicles as who do you think will regulate them. When you travel, where you travel and how fast you travel will be controlled by them all in the name of congestion.
Calling it “government money” makes it sound benign. It’s OUR money.
Right on brother
Agreed
Whenever the government gets behind an idea, you know it is never a good outcome
To paraphrase Will Rogers, whenever congress make a law, it’s a joke, and whenever congress makes a joke, it’s a law.
Glen, never a more accurate statement! The government always uses poor judgement while spending OUR tax money.
They use reckless accountability procedures and treat the funds they allocate for “approved” programs as a “neverending” river of available money for them to MISSPEND!
It is evident that our government has “lost its way” in performing the “intended function” they wee created to perform!
Poor leadership with obscured accountability.
I traded a beat up ’96 Crown Vic for a ’09 HHR.
Paid 7,850 out the door for a 18,290 MSRP HHR. I was out of work at the time but couldn’t pass up getting a new car for less than used ones were at the time. Bottom line it worked out will for me. I fact the HHR I sold to my sister in ’18 and it’s still on the road
I saw a list of clunkers that were turned in, years ago. Awful lot of Nissan Quest and Mercury Villagers on it. There was also ONE Buick Regal T-Type(or was it a GNX??) listed, at least two Aston Martins on it, and two late model Roush F-150s.
My understanding was that the clunkers’ ENGINE S had to be destroyed, but not necessarily the rest of the vehicle. Why not fund an engine replacement program to get “rid of” the ‘polluting’ engines,but save the vehicle?
they had to be crushed in six months, herr.
It seemed more like cash for Kia’s and Hyundai’s at the time
Typical of the government to never think of the full range of unconsidered drawbacks to their wasteful overreach spending.