Last Thursday saw the Senate pass the Cash for Gas Guzzlers bill inside the war funding bill.  It’s a near certainty that President Obama will sign it into law.  So, its time to look and see if the cash will apply to you and whether or not you can get it done in time.  There is a limit, similar to the TV Converter Box Coupon Program, where the money ran out stranding millions of Americans.  But its not a mere $40, it can be up to $4,500.  It’s heads up time.  But move on it before the money is gone.

Geoff Styles has been watching this and offers that the Detroit News has a tool on their site to see if you own one of the qualified guzzlers. What fits are cars and light trucks rated a combined (a blend of city and highway driving) 18 mpg or less; large pickups and SUVs at 15 mpg or less and work trucks built before 2002.  The Detroit News tool is quick, has the fields to zero in on the engine, transmission and other characteristics that will qualify a guzzler or not.  While it’s a handy tool, it’s not comprehensive, so the Fed’s own site is the complete listing and the fallback, double check site.

It could be a pretty strong benefit, even when considering large vehicle.  One needs to get a 4-mpg gain to qualify and a 10-mpg gain for the full benefit.

The bill has its detractors.  My favorite examiners at the Wall Street Journal headlined their article about the bill “Cash From Lunkheads.” Probably so, but it’s cash to cut the cost of improving one’s personal transportation.  The Journal also allowed two Senators to comment with a title of “Handouts for Hummers,” that while it’s still possible to buy one, has to fly in the face of incredible dopiness as GM has killed the Hummer line and they’re hardly the status symbol of two years ago.  But that sort of thing has to be sold off, and will be at some price or another.

Even with Germany’s successful and quite expensive plan to rid itself of many gas guzzling vehicles, the U.S. bill just barely got in by getting tacked onto a ‘can’t fail to pass it’ bill for supporting the troops.  Here is a link to the bill as found by Geoff.

Geoff has also studied the bill with these conclusions to guide the early shopper.  These will have to do until the bureaucracy actually publishes the regulations.

·    The car traded in must be no more than 25 years old, in drivable condition and certified at 18 mpg or less in EPA “combined fuel economy” (15 mpg for a typical SUV/light truck.).
·    It must have been insured and registered to the owner for at least one year prior to trade-in.
·    It must be shredded or crushed, though not before the auto recycler sells off any desirable parts.
·    The new vehicle must get at least 22 mpg (15 mpg SUV/light truck) and,
·    At least 4 mpg more than the trade-in (1 mpg SUV/light truck) to qualify for a $3,500 tax-free voucher, or,
·    At least 10 mpg more (2 mpg SUV/light truck) to qualify for the maximum $4,500 tax-free voucher.
·    It can’t cost over $45,000.

I expect Geoff will be accurate; it’s just a question of how the legal minds in the government read the law to know exactly how to buy and get the voucher.

I wouldn’t dither around.  The program only runs from July 1, 2009 until November 1, 2009 with a meager $1 billion of funds behind it.  That might cover 222,000 vehicles at the maximum payout each, which is a small number even in the current depressed market.  Note that the whole spectrum of manufacturers are included, buying a U.S. nameplate isn’t a requirement, but with such far-flung parts sourcing and so many foreign nameplate plants in the U.S. – being able to tell would require checking the window sticker of every car for content.

It’s probable that the new car dealers will have the execution of the benefits set up shortly.  So before the 222,000 gets passed before you, the shopping needs attended to very shortly. One wouldn’t want to be 222,001 and find the money gone.  That $4,500 is a considerable chunk of a good sensible car and will have a considerable impact on the payment

Two more points, one is the Congress did, after months of waiting, re-fund the TV Converter Program.  The other is the dealer you choose after zeroing on in your choice.  The dealer will have to be up and running the voucher program on July 1.

Good luck.  It’s a significant opportunity for the organized early actors.  But 222,000 is only about a third of a month’s U.S. car sales now.  The money could be gone in ten days or less.


2 Comments so far

  1. Matt on June 23, 2009 6:00 AM

    More Democrate “Let’s Print Money Until We Choke” stimulus. How about we subsidize the wealthy?

    I cannot believe they did not include at least a made in North America requirement. The content origin is on the window sticker!

  2. Mary on June 23, 2009 6:51 PM

    Pretty good post. I just stumbled upon your site and wanted to say
    that I’ve really liked reading your blog posts. Any way
    I’ll be subscribing to your blog and I hope you post again soon!

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