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There's a lot of questions about this program. The one that intrigued me me was, "Are the expected benefits worth the expected cost".

The program is usually sold as a green initiative, to reduce auto emissions and reduce oil imports/dependency on imported oil. Secondarily, it is sold sometimes as an aid to the American auto industry, although I think foreign cars qualify too. Lastly, some people have the mistaken notion that it is to help the poor. It's not.

I used an increase of mileage from 16 to 22, average annual miles of 20K, and a weighted yield of 19.74 gallons/bbl. Assuming 250,000 trades (the original target), I come up with a net reduction of about 1/3 of one day's USA IMPORTED oil (not total usage). At $3500 x 250,000, is this cost efficient? It. works out to about $40/bbl. Other possible benefits are harder to quantify.

Check my math, people. Change my assumptions. whatever numbers you come up with, the question remains, if this cost efficient? Are we getting enough bang for our bucks?
Well, my dad was one of the people who took advantage of it, trading in a Ford Explorer for a Toyota Prius. He was in the market sometime in the next 2 to 3 years for getting a new car, and given he had a mid-90s Explorer sitting in the driveway, rarely driven any more with trade-in value less than $1k, this was a no brainer from a trade-in value standpoint. The Volvo station wagon he drove goes into third car mode (meaning rarely used), and this becomes his primary car (used a lot for business, as he's an insurance agent visiting clients a lot).

I wonder how many of these trade-ins are like this, where you're actually not getting many miles off the road?

One hard benefit you are ignoring is the one-time bump in car sales this is driving, keeping folks employed a little longer in both the factories and dealerships. Not sure exactly how to quantify it, but it is definitely a hard, measurable benefit.

Also, who gets the cash benefit (however small or not) from selling these "clunkers" to the scrap metal outfits? (Another industry that will get a benefit, at least from some employment.) Is it the federal government? I sure hope so.
(08-01-2009 12:46 PM)gsloth Wrote: [ -> ]Also, who gets the cash benefit (however small or not) from selling these "clunkers" to the scrap metal outfits? (Another industry that will get a benefit, at least from some employment.) Is it the federal government? I sure hope so.

The junkyard business isn't overly thrilled with the program, as the engines have to be destroyed in order to get the rebates, and that's the most profitable part of the car from their standpoint.
I want to see how many cars were purchased with the first $1 Billion.

The Feds supended the program with less than 50,000 units sold.

The average cost is $4000.00 (splitting the difference between $3500 and $4500)

There must be a hell of an administrative expense/overhead involved if you sell less than 200,000 units with the first Billion.

And you want these same Government Bozo Bureaucrats running your Health Care?
(08-02-2009 07:02 PM)WMD Owl Wrote: [ -> ]I want to see how many cars were purchased with the first $1 Billion.

The Feds supended the program with less than 50,000 units sold.

The average cost is $4000.00 (splitting the difference between $3500 and $4500)

There must be a hell of an administrative expense/overhead involved if you sell less than 200,000 units with the first Billion.

And you want these same Government Bozo Bureaucrats running your Health Care?

Not me.

and I used $3500 straight through on my estimates, wanting to be as conservative as possible in figuring the cost/barrel.
1) The program is still operating... the $1 billion is not yet spent

2) The program has received 157,000 applications for reimbursement thus far

3) See 1.

The Transportation department has merely said that they expect to go through the full $1 billion this week, which makes sense if you consider most of the applications to fit the guidelines of the program (and since the dealers would be left high and dry if they pay out for a car that doesn't meet the requirements, I would wager that most of the applications do meet the requirements).

All the same, I would like to see more data than just total number of applications out of the Transportation department prior to any new appropriations... but so far the program appears to be far more of a success than the Republicans and the media have made it out to be.
I don't like that my tax dollars are rewarding people for their irresponsible decisions.
(08-04-2009 06:28 PM)texd Wrote: [ -> ]so far the program appears to be far more of a success than the Republicans and the media have made it out to be.

Define success.

Ostensibly the purposes of the program is to

A. Reduce emissions. Probably will do that that, not now so much as in the future, but the question remains: at what cost? Is the reduction worth it? Will it even be noticable? IMO, the jury is still out.
B. Reduce dependence on imported oil. Again, it probably will, a little, but again, is it worth the cost? I calculated a reduction equal to 1/3 of one day's oil imports, at a cost of $40/barrel. Assuming those numbers are right (a big assumption, to be sure), once again the question is, is it worth it? IMO, the jury is out on this one, too.
C. Stimulate the American auto industry. So far, 4 of the 5 top new cars bought with this program are Toyota or Honda. The fifth is Ford, the one American automaker that DIDN'T need a bailout. Is this success? Depends on the definition, but probably not. Also, there is concern that the program did not generate much in the way of addtional sales, just moved some up from later this year or from next year, and future sales will be reduced correspondingly. Maybe it even took sales from GM/Chrysler and moved them to Honda/Toyota/Ford.
Now how is my decision to drive around in an old, paid for, well maintained land yacht which barely qualifies for the program because the mileage is borderline (my car was off the original qualifying list and is on the current one) somehow an irresponsible decision? I suppose you think that carrying only liability and not full coverage on this "clunker" is irresponsible too?

And OO is right - I did consider trading in my "clunker" even though it has 100,000 miles or more left in it just to get my college age child a car now instead of a year from now when she'll be able to get a parking spot on campus.

*removing my tongue from my cheek* The above is true. However, I agree with Gravy that it irks me to pay for someone who has a poorly maintained clunker to take it off the road. Why not just give the cash directly to the auto makers instead of trying to buy votes with it? Oops. Did I say that out loud? *slinks away*
(08-04-2009 06:45 PM)RiceDoc Wrote: [ -> ]*removing my tongue from my cheek* The above is true. However, I agree with Gravy that it irks me to pay for someone who has a poorly maintained clunker to take it off the road.

Doesnt that seem to be the hallmark of the current government?

Manufacturing --- never mind it was labor costs that lined the companies slope to BK, give the UAW the company over the interests of the secured shareholders. Penalizes the responsible secured creditholders with respect to the "we cant fire you -- ever; we will pay for you to sit in a clubhouse" group.

Health --- take the money from the people that have healthcare and hand over a system that allows anyone to participate at equal rates notwithstanding their personal choices; even those who live off of 40 Twinkies and a bottle of Scotch a day. In this way, one who actually takes care of their health will be penalized to make sure that this subset is not "discriminated" against. And by the way, everyone is *required* to play......

Mortgage Program --- we will pay to have non-performing loans "taken care of" for the interim. Seems to me I got royally screwed by buying a house that was *much* smaller and *much* less than I could afford.

Doc, your gripe isnt just with the cash for clunkers program in the hopenchange world.
OO - here's some more focused analysis of the numbers around Cash for Clunkers, from the Washington Post (an external source did the analysis and graphic): http://www.washingtonpost.com/wp-dyn/con...2658.html. Essentially, it doesn't look like a good tradeoff.
(08-04-2009 06:45 PM)RiceDoc Wrote: [ -> ]Now how is my decision to drive around in an old, paid for, well maintained land yacht which barely qualifies for the program because the mileage is borderline (my car was off the original qualifying list and is on the current one) somehow an irresponsible decision?

Okay, quibble over my wording, but the fundamental premise of this program is that good mileage is better than bad mileage. Clearly it rewards those who previously chose bad mileage. I think we agree on the implications of that.
(08-11-2009 02:25 PM)Gravy Owl Wrote: [ -> ]
(08-04-2009 06:45 PM)RiceDoc Wrote: [ -> ]Now how is my decision to drive around in an old, paid for, well maintained land yacht which barely qualifies for the program because the mileage is borderline (my car was off the original qualifying list and is on the current one) somehow an irresponsible decision?

Okay, quibble over my wording, but the fundamental premise of this program is that good mileage is better than bad mileage. Clearly it rewards those who previously chose bad mileage. I think we agree on the implications of that.

I would agree that, all other things being equal, good mileage is better than bad mileage. I also agree that we are rewarding people who arguably chose bad mileage over good mileage. The problem is that I don't think the premise holds water - seldom are "all other things" equal! Yes, I could have chosen a small Honda or toyota or name your import offered under whatever sticker you chose to put on it instead of a bigger, more comfortable, safer land yacht. I knew going in that I would pay a little more at the pump, but it was worth it to me. Those taking the cash now are those driving "clunkers", i.e. those who didn't do the basic maintenance to keep them operating in the fashion they were designed to operate in. I can accept the initial decision of people. What I can't accept is rewarding them for the subsequent bad behavior.

BTW, my child is driving that old, safe, large car now instead of me. I figure I'd rather have her in it when she gets into the probably new driver wreck than in some tin can that got great mileage before getting hauled off to the junk yard after she died in it. And $3500 is not going to change my mind on that.
(08-11-2009 02:51 PM)RiceDoc Wrote: [ -> ]Yes, I could have chosen a small Honda or toyota or name your import offered under whatever sticker you chose to put on it instead of a bigger, more comfortable, safer land yacht.

Well, that's fine. I shouldn't have said "irresponsible." I thought the point would get across, but it isn't really what I meant. I meant that there is a preferred action and a discouraged action, and we are rewarding those who chose the discouraged action. I think that is backwards. A better approach IMO would be to extend the tax credits for buying efficient vehicles regardless of trade-in.

Optimistic has suggested increasing the gas tax, and while I expect most conservatives would howl about that, I think it's an even better incentive for good mileage. It is also an incentive for driving less.

A gas tax hike, however, is not a short-term incentive for major purchases. Looking at the requirements (new vehicles can qualify even at less than 20 MPG!), I think that's the real purpose of the C/C program.

Quote:BTW, my child is driving that old, safe, large car now instead of me. I figure I'd rather have her in it when she gets into the probably new driver wreck than in some tin can that got great mileage before getting hauled off to the junk yard after she died in it. And $3500 is not going to change my mind on that.

We've been through this before, but I will again point out that bigger is not necessarily safer, especially if the big car is much older. If I had to make a rule of thumb for safety it would probably be 4-wheel disc brakes with ABS. Of course that's an oversimplification also, but I think it's a better oversimplification.
(08-11-2009 04:56 PM)Gravy Owl Wrote: [ -> ]Looking at the requirements (new vehicles can qualify even at less than 20 MPG!)

Sorry for responding to myself, but I want to expand on this some.

If you trade in a very large truck (e.g. Chevy 1-ton) for a similar size truck, regardless of old or new mileage, you get $3500.
If you trade in a full-size truck that gets 14 MPG for a full-size truck that gets 15 MPG, you get $3500.
If you trade in a car that gets 18 MPG for a small truck that gets 20, you get $3500.
If you trade in a car that gets 18 MPG for a car that gets 20, you get nothing.
If you trade in a car that gets 19 MPG for any vehicle that gets 20, 30, or even 40, you get nothing.

And I should point out that these are all based on EPA estimates. Someone who drives inefficiently may get significantly worse mileage, but they still get the reward.

Source
A couple of related questions....

I don't want to trade in my 2001 Windstar quite yet (it's got 130K miles but should be good for another year or two I hope). So first question, do you think this program will be around in one fashion or another in 2010 or 2011?

Second question - unrelated really - but does anyone believe GM's claim their electric car can get 240 miles to the gallon (sorry if I have the facts off a bit)? And if you can go 800-1000 miles on a full tank, is $40,000 a good price for a vehicle like that?
(08-11-2009 04:56 PM)Gravy Owl Wrote: [ -> ]
(08-11-2009 02:51 PM)RiceDoc Wrote: [ -> ]bigger, more comfortable, safer land yacht.

Quote:BTW, my child is driving that old, safe, large car now

We've been through this before, but I will again point out that bigger is not necessarily safer, especially if the big car is much older.

I couldn't agree more. With cars, "Old" is typically inversely proportional to "safe", even if the older car is a big 'un. ABS systems, brighter headlights, daytime running lights etc. all decrease the risk of suffering a collision in the first place. Shatter-proof glass, collapsible steering columns, hardened passenger compartment frames, fireproofing, air bags, etc. all decrease the risk of death or injury when a collision occurs. All of these are much, much, much more determinative of safety than size or weight.
(08-12-2009 01:50 PM)georgewebb Wrote: [ -> ]
(08-11-2009 04:56 PM)Gravy Owl Wrote: [ -> ]
(08-11-2009 02:51 PM)RiceDoc Wrote: [ -> ]bigger, more comfortable, safer land yacht.

Quote:BTW, my child is driving that old, safe, large car now

We've been through this before, but I will again point out that bigger is not necessarily safer, especially if the big car is much older.

I couldn't agree more. With cars, "Old" is typically inversely proportional to "safe", even if the older car is a big 'un. ABS systems, brighter headlights, daytime running lights etc. all decrease the risk of suffering a collision in the first place. Shatter-proof glass, collapsible steering columns, hardened passenger compartment frames, fireproofing, air bags, etc. all decrease the risk of death or injury when a collision occurs. All of these are much, much, much more determinative of safety than size or weight.

"Old" in this case is a relative term. She isn't driving my pre-war cars; she is driving my '97 Caddy. ABS? check. daytime running lights? check. Shatter-proof glass, collapsible steering columns, hardened passenger compartment frames, fireproofing, air bags? check, check, check, check, check. All other things being equal, the big land yacht will make it far more likely that any injuries will be less severe and survival more likely than a smaller, lighter car with those same things. When it comes to cars and safety, Smilin' Bob is right! 03-melodramatic
(08-12-2009 01:17 PM)Fort Bend Owl Wrote: [ -> ]A couple of related questions....

I don't want to trade in my 2001 Windstar quite yet (it's got 130K miles but should be good for another year or two I hope). So first question, do you think this program will be around in one fashion or another in 2010 or 2011?

Second question - unrelated really - but does anyone believe GM's claim their electric car can get 240 miles to the gallon (sorry if I have the facts off a bit)? And if you can go 800-1000 miles on a full tank, is $40,000 a good price for a vehicle like that?

I don't think the program will be around after this year.

Also, that 240 mpg for the Volt was for city driving, and it's based on a formula to try to equate hybrid efficiency with a gas vehicle. Actual drive testing to come up with real mileages will not occur until later.

I'm pretty sure that higher speed driving is going to be much lower. Chevy is saying you can go around 40 miles without kicking in the gas motor.
(08-12-2009 03:06 PM)gsloth Wrote: [ -> ]Also, that 240 mpg for the Volt was for city driving, and it's based on a formula to try to equate hybrid efficiency with a gas vehicle. Actual drive testing to come up with real mileages will not occur until later.

And you can expect your electric bill to go way, way up.
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