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Old 06-10-2009, 07:56 PM   #21
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Originally Posted by John Galt III View Post
Let's say Hyundai dealer is offering $2,000 discount from Hyundai, and $500 discount from dealer, total discount is $2,500. Eager new car car-buyer with clunker shows up and expects discount of $2,500 from industry plus $4,500 from taxpayers totalling $7,000 but dealer says "Oh no, you only get the $4,500 discount. Don't be greedy", and Hyundai and the dealer save the $2,000 and the $500 discounts. Businesses win, clunker owner wins (somewhat) and taxpayers take the hit. Sounds about right.
There is language in the law to essentially disallow dealers to charge additional fees for those using the vouchers.

See section (c)(1)(F):
"NO ADDITIONAL FEES- A dealer participating in the program may not charge a person purchasing or leasing a new fuel efficient automobile any additional fees associated with the use of a voucher under the Program."

Violation of the act carries a $15,000 civil penalty.

I'd use the ambush tactic: negotiate the price, get the final papers out for signature, then say oh, by the way, I'd like to trade in this clunker and get that $4,500 credit applied to the purchase price while I'm at it.

On a different note, I have entered negotiations to buy a 1986 station wagon from my parents that gets 17 mpg. And runs. The 2009 honda civic (the likely new car) gets 29 mpg. Sweet! May have to pick up another clunker for my wife so she can get a new car too for ~$3500 off. Good ole uncle sam's generosity.
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Old 06-10-2009, 08:13 PM   #22
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One provision that concerns me is that the car must be in operational condition at the time you trade it in. So if I buy a car for a year and a day, I would have to make sure it still runs when I try to trade it in. Not sure if that means it actually has to pass emissions inspections and safety inspections...
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Old 06-10-2009, 08:57 PM   #23
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There is language in the law to essentially disallow dealers to charge additional fees for those using the vouchers.

See section (c)(1)(F):
"NO ADDITIONAL FEES- A dealer participating in the program may not charge a person purchasing or leasing a new fuel efficient automobile any additional fees associated with the use of a voucher under the Program."

Violation of the act carries a $15,000 civil penalty.

I'd use the ambush tactic: negotiate the price, get the final papers out for signature, then say oh, by the way, I'd like to trade in this clunker and get that $4,500 credit applied to the purchase price while I'm at it.

On a different note, I have entered negotiations to buy a 1986 station wagon from my parents that gets 17 mpg. And runs. The 2009 honda civic (the likely new car) gets 29 mpg. Sweet! May have to pick up another clunker for my wife so she can get a new car too for ~$3500 off. Good ole uncle sam's generosity.
I'd wait until we see what finally emerges.

And that "No additional fees" language is a hoot. Have these legislators never bought a car? How is a customer going to know if he was charged an "extra fee?" Even if a customer waits until the end to ambush the dealer, he could suddenly discover that the car the customer wanted was "just sold by another salesman," but luckily he has another, even nicer car, with some special undercoating and much nicer wheels. "With your rebate for the clunker, you're still saving a lot of money and getting a better car."
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Old 06-10-2009, 08:59 PM   #24
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One provision that concerns me is that the car must be in operational condition at the time you trade it in. So if I buy a car for a year and a day, I would have to make sure it still runs when I try to trade it in. Not sure if that means it actually has to pass emissions inspections and safety inspections...
Who is supposed to check that the trade-in runs? The dealer? If so, I wouldn't worry--they'll sign a paper saying it was running when you coasted it into their lot if that's what it takes to get the $$ from Uncle Sam.
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Old 06-10-2009, 11:21 PM   #25
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Meanwhile, whatever new car sales would have been made to folks who own older cars that may or may not fit this clunker definition have stopped entirely as people wait to find out the rules. If they meant to stimulate new car sales, causing a drop to near zero sales while they work out the details may be an unexpected side effect.
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Old 06-11-2009, 07:44 AM   #26
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I wonder why I/we are analyzing this as though it has some rational purpose that can be identified by looking at the result. This is, after all, (proposed) legislation. It would be like trying to identify the higher thoughts of a pig by looking at a sausage.
Exactly.

Most of the energy conservation legislation is written this way. My simple tests is:

A) Can you measure the results, to determine if the program is effective? Corollary - are the results reasonably predictable.

B) Does the program provide reasonable "bang for the buck"? Or would other programs provide more gas savings with less govt (taxpayer - you & me) money spent?

If you fail A, you can't answer B.

And this fails the test. It is pretty tough to know how much gas will be saved. 1mpg is a small diff, and some of these people may drive more miles, now that they have a shiny new vehicle with better mileage. And how much savings per $ can we expect?

Trying to modify behavior isn't that different from trying to improve a design or process in the laboratory. You analyze the problem, develop some potential solutions based on your knowledge of how these things work (supply/demand curve, behavioral science studies, etc). You test, or model the most promising ones, and analyze the results. You evaluate the cost effectiveness, and chose.

It isn't rocket science, but it is basic logical process. Looks like the govt just wants headlines so they can claim they are "doing something". If this passes, someone will brag, "we took X million old clunkers off the road....", but what was the benefit?


Also, any comparisons to pigs and/or sausage is an undeserving slam against pigs and/or sausage makers. Leave them out of this!

If I have time later, I'll start a new thread on CFLs - there is some new info out there....

-ERD50
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Old 06-11-2009, 09:15 AM   #27
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I agree with all these criticisms, including my own.

But perhaps, together with a probably-coming-soon increase in gas prices, this could have an impact.

The people driving around in rusty Monte Carlos might go for this in a big way.

ERD50, I seem to remember that you had a convincing argument that it made more sense to get rid of the 15 MPG cars and replace them with 25-30 MPG cars than to replace the 30 MPG cars with 100 MPG vehicles?
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Old 06-11-2009, 09:24 AM   #28
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John, from what I have heard, the money goes directly to the dealer.
I am not sure if the dealers will discount the rebate up front, or pass it along once they get it.
If you don't demand they do, it becomes an instant moneymaker for them. I remember a local dealer who was big on the $3500 push pull or drag sales. The DAY BEFORE the sale started, they would make up all new window stickers on their used cars that were $3000 higher than before..........
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Old 06-11-2009, 09:53 AM   #29
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I'd wait until we see what finally emerges.

And that "No additional fees" language is a hoot. Have these legislators never bought a car? How is a customer going to know if he was charged an "extra fee?" Even if a customer waits until the end to ambush the dealer, he could suddenly discover that the car the customer wanted was "just sold by another salesman," but luckily he has another, even nicer car, with some special undercoating and much nicer wheels. "With your rebate for the clunker, you're still saving a lot of money and getting a better car."
You can always threaten to report them for violating the act. Violation carries a $15000 civil penalty.

In any event, I would walk if they won't take the deal. There's always someone else looking to make a sale.
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Old 06-11-2009, 10:13 AM   #30
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You can always threaten to report them for violating the act. Violation carries a $15000 civil penalty.

In any event, I would walk if they won't take the deal. There's always someone else looking to make a sale.
I would wait until the details are worked out. An educated consumer always wins..........
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Old 06-11-2009, 10:14 AM   #31
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ERD50, I seem to remember that you had a convincing argument that it made more sense to get rid of the 15 MPG cars and replace them with 25-30 MPG cars than to replace the 30 MPG cars with 100 MPG vehicles?
Yes, but I would not call it a "convincing argument" any more than I would say that someone pointing out that 2 + 2 = 4 made a "convincing argument". It is just math, and the math of mpg is misleading in terms of gas savings.

10 mpg and 10,000 miles driven = 1,000 gallons used.
20 mpg and 10,000 miles driven = 500 gallons used.

So 500 gallons saved by "doubling" the mpg rating from 10 to 20mpg.



30 mpg and 10,000 miles driven = 333.3 gallons used.
90 mpg and 10,000 miles driven = 111.1 gallons used.

So only 222.2 gallons saved by "tripling" the mpg rating from 30 to 90mpg.


Even an EPA rep was talking about how mpg stickers should be replaced by "gallons used per thousand miles" stickers. The savings are much easier to compare. Just multiply by the thousands of miles driven - they could even put a line to show gallons at typical range of miles driven to make it completely obvious.

But that is the issue - the govt is not addressing "gallons of gas used", they are addressing indirect things like mpg. MPG does not factor in miles driven, carpooling, cautious driving, telecommuting, combining trips, public transportation, etc, etc.

I'm starting to think that Federal govt spending should need to be approved by Referendum by those who pay Federal taxes. If "No taxation w/o Representation" was a founding theme of this country, then I think there is some merit to the corollary, "No Federal spending approved by those who did not contribute". I should be able to represent my Federal contribution, I'm not so sure that someone who did not contribute should have equal say.



Quote:
I agree with all these criticisms, including my own.

But perhaps, together with a probably-coming-soon increase in gas prices, this could have an impact.

The people driving around in rusty Monte Carlos might go for this in a big way.
It might have some impact. That impact might be negative. But if it isn't the best use of funds (or at least reasonably good) to achieve the goal, it isn't good policy.

Could it be negative? I think it could - How much oil does it take to make a new car? Maybe those old cars are being used for low mileage uses like commuting to a train station, or a second/third 'backup' vehicle? The gas savings could be offset by the early retiring of an asset with a still useful life. In fact, I've done the math on some of my appliances - no way am I going to replace a working unit with a marginally more efficient one. It seldom makes sense (it did for people with high heat bills and an old 55% eff furnace to upgrade to a 85% plus eff unit, but those opps are rare).

While I'm on a rant here, another thing really bugging me is the medias constant description of electric and fuel cell cars as "zero pollution". Those cars *move* the pollution to the electrical power plant (pay no attention to that mountain that used to be there before we stripped it for coal). It can be a net win, but sure is not "zero pollution". I guess I could pump my sewage into my neighbor's yard, and then claim I don't have a sewage waste disposal problem? Maybe I could get a Nobel Prize for that kind of thinking?

-ERD50
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Old 06-11-2009, 10:15 AM   #32
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I'd wait until we see what finally emerges.

And that "No additional fees" language is a hoot. Have these legislators never bought a car? How is a customer going to know if he was charged an "extra fee?" Even if a customer waits until the end to ambush the dealer, he could suddenly discover that the car the customer wanted was "just sold by another salesman," but luckily he has another, even nicer car, with some special undercoating and much nicer wheels. "With your rebate for the clunker, you're still saving a lot of money and getting a better car."
Keep in mind that dealers can always trade another dealer for the car you want, or go to another dealer. I think these days, dealers are desperate for sales to keep the doors open..........
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Old 06-11-2009, 10:18 AM   #33
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While I'm on a rant here, another thing really bugging me is the medias constant description of electric and fuel cell cars as "zero pollution". Those cars *move* the pollution to the electrical power plant (pay no attention to that mountain that used to be there before we stripped it for coal). It can be a net win, but sure is not "zero pollution". I guess I could pump my sewage into my neighbor's yard, and then claim I don't have a sewage waste disposal problem? Maybe I could get a Nobel Prize for that kind of thinking?-ERD50
Interesting that Toyota has never commented on the huge "dead zone" created outside the plant that makes hybrid batteries for the Prius. Environmental groups from all over the globe have come there to do studies. Literally NOTHING gorws there, it is devoid of life. I suppose because its in a country other than the US, it's not news.........
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Old 06-11-2009, 10:23 AM   #34
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Interesting that Toyota has never commented on the huge "dead zone" created outside the plant that makes hybrid batteries for the Prius. Environmental groups from all over the globe have come there to do studies. Literally NOTHING gorws there, it is devoid of life. I suppose because its in a country other than the US, it's not news.........
It's not a big deal in the US. We have Superfund to clean up any environmental mess. It is free and provided by the government. They are here to help us.
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Old 06-11-2009, 11:26 AM   #35
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There is language in the law to essentially disallow dealers to charge additional fees for those using the vouchers.

See section (c)(1)(F):
"NO ADDITIONAL FEES- A dealer participating in the program may not charge a person purchasing or leasing a new fuel efficient automobile any additional fees associated with the use of a voucher under the Program."

Violation of the act carries a $15,000 civil penalty.

I'd use the ambush tactic: negotiate the price, get the final papers out for signature, then say oh, by the way, I'd like to trade in this clunker and get that $4,500 credit applied to the purchase price while I'm at it.

On a different note, I have entered negotiations to buy a 1986 station wagon from my parents that gets 17 mpg. And runs. The 2009 honda civic (the likely new car) gets 29 mpg. Sweet! May have to pick up another clunker for my wife so she can get a new car too for ~$3500 off. Good ole uncle sam's generosity.

The no additional fees clause is great, but that won't prevent the dealer from scaling back all the incentives that he has, like the $2,000 discount from the manufacturer, or the $500 to $1000 hit the dealer may have taken on a non-Uncle Sam deal. The dealer would say something like "Well, our policy is to only give a $500 dealer discount and only a $1000 manufacturer discount for those folks using the government rebate".

It's not a "fee" to scale back the discounts, although I would term it an implicit "penalty" for using the government rebate, if the dealer does this.

The ambush tactic is a possibility, but I think the dealer would just whip out the "Oh, gosh, I'm sorry, it's our policy to ..... blah, blah, blah " and want to change the deal.
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Old 06-11-2009, 01:09 PM   #36
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The ambush tactic is a possibility, but I think the dealer would just whip out the "Oh, gosh, I'm sorry, it's our policy to ..... blah, blah, blah " and want to change the deal.
In such a case, the consumer needs to make it clear that it's their policy to walk away.
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Old 06-11-2009, 01:16 PM   #37
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In such a case, the consumer needs to make it clear that it's their policy to walk away.
Definitely. I would let my feet do the talking.

Although I would probably fax/email out specifications to 10 dealers for quotes and go and negotiate with the top couple of places.
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Old 06-11-2009, 06:35 PM   #38
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Interesting that Toyota has never commented on the huge "dead zone" created outside the plant that makes hybrid batteries for the Prius. Environmental groups from all over the globe have come there to do studies. Literally NOTHING gorws there, it is devoid of life. I suppose because its in a country other than the US, it's not news.........
You're probably referring to the Sudbury, Ontario nickel smelting plant.

The Sudbury Basin is the site of the second largest known meteor crater (astrobleme) on Earth, and the magma upwelling (Sudbury Igneous Complex) produced mineral deposits that currently make this one of the world's largest suppliers of nickel and copper ores. Mining and smelting has been going on here since 1883. Open pit smelting starting in the 1880s destroyed much of the area's plant life that remained after heavy logging, leading to massive soil erosion.

Major miners involved are INCO and Falconbridge. The INCO SuperStack project (a 1234 foot smokestack!) built in 1972 shifted the ground level air pollution that destroyed plant life to a high altitude dispersed cloud. While the local area benefited, lakes in the larger area quickly became more acid from the dissolved sulphur dioxide in area rainfall.

Scrubbing equipment was finally added in 1994, and sulphur dioxide emissions dropped by a factor of 10. Conditions in the Sudbury area are greatly improved these days.

Blaming the Toyota Prius for damage produced primarily from 1883 to 1972 by world demand for nickel, dominated by the stainless steel industry (70% of all nickel mined) strikes me as disingenuous at best.

I'd blame all the folks using stainless steel tanks, pipes, fittings, and of course, homeowners with Evil stainless steel sinks containing deadly, deadly nickel. Oh, and camera batteries. Nickel-metal hydride batteries as found in the Prius and other electrical systems account for only a minute amount of the nickel mined. There's more nickel in the exhaust system of a sports car such as the BMW M3 than in the Prius battery.
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Old 06-11-2009, 08:40 PM   #39
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Here's the bill:

Search Results - THOMAS (Library of Congress)

Excerpt:

...the eligible trade-in vehicle is a category 2 truck and the combined fuel economy value of the new fuel efficient automobile is at least 1 mile per gallon higher than the combined fuel economy value of the eligible trade-in vehicle; or...

1 MPG difference. La di frickin da.
The 1 mile provision likely will not survive the senate.
The draft house bill had much greater mileage requirements, but word was that Diane Fienstien in the senate was going to insist on still higher requirements that would have everyone lining up for Smart cars, which of course would not happen, thus killing the program.
My guess is that the house dropped their mileage to the silly zone so as to allow Diane to goose it up to where the house originally was, thus appearing to be ...well whatever...I'm on thin ice here.
Ultimately yielding a sensible bill.
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Old 06-11-2009, 11:18 PM   #40
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I am definitely keeping my eye on this. DH has a 1999 Dodge Durango that we would love to get rid of and get something more fuel efficient. The trick is for him to agree to something more fuel efficient. I started watching our expenses 5/13/09 and from 5/13 through 6/7/09, we have spent $352.29 on gasoline. I am retired and DH works less than 5 miles from our house. It is the season for him to drive his corvette with the 454 big block though. It is pretty much his only hobby now. We both made trips to Silver Spring MD to help DD move back home, while her DH is in TX for 3 mos training.
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