Since the beginning of this year, I have been keeping tabs on the various “cash for clunkers” programs being rolled out, particularly in Germany where their scrappage program has had a most positive effect on new car sales. Britain currently has a similar program in place while several other European states have crafted their own programs too.

Realizing An Environmental Benefit Too

In the US, cash for clunkers legislation was debated in Congress for several months as legislators attempted to craft a program that would remove older, less fuel efficient and more polluting models off of American roadways, scrap them; replacing them with newer, more fuel efficient and environmentally friendly cars. With this legislation Congress not only wanted to stimulate new car sales, but they were looking for an environmental benefit as well.

The US scrappage program – Car Allowance Rebate System (CARS) – has been signed into law and will kick in once all of the details have been hashed out by the National Highway Traffic Safety Administration (NHTSA) who has oversight. The NHTSA has created a website at cars.gov which consumers should visit for more information. This is critical because scam artists are already at work spreading misinformation and in some cases attempting to steal consumer information.

What CARS Can Do For You

The program won’t be going into place until later this month (July 23rd is the latest date that it can start) so it is important that you follow the rules in order to get your rebate (credit) which will be given to you at the dealership when you buy your car. This means that if you’ve negotiated the final price for a 2009 Ford Fusion SE down to exactly $20,000, then the dealer will deduct as much as $4500 off of that price. You could end up leaving your Ford dealership driving a leftover Fusion (the 2010 models are already out) for just $15,500 plus taxes, tags, registration and other fees. A terrific price for a quality midsize sedan!

The downside to this government program is that only one billion dollars has been made available to fund it. This means that around 250,000 car buyers will be able to participate in the program which comes to an end on November 1st or when funding runs out. Likely, they’ll be a huge surge in showroom traffic when the program kicks in, drying up available rebates by September. In Germany, the program was so popular that it was extended with additional funding; new car sales are up 40% over last year as a result. Don’t count on that happening in the US although Congress and the president are certainly in a spending mood.

Avoid The Scam, Follow CARS

I won’t go into all of the details of whether you’ll be eligible for this program as the parameters are quite narrow. This means that only owners of older gas hogs will be able to participate provided that all of the other requirements have been met. Visit the How Will Cars Work page to find step by step program details; if you find other information online that contradicts the federal program, then please ignore it or risk being scammed.