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Cash For Clunkers - AKA Car Allowance Rebate System

Unforeseen Consequences of the Cash For Clunkers Program

In 2009, Laurens Auto Salvage participated in the "Cash For Clunkers" program. We found there was so much chaos and confusion during the implementation of this program that we decided to create this FAQ page to help our dealers with program implementation. In addition, it answered many questions from our customers who were attempting to salvage vehicles and (mistakenly) obtain a government credit for them. Although difficult, in general the program was a success for our business at the time. Unfortunately, years later we, along with others in the industry, are now suffering the consequences this program has had on the recycling industry.

It has created such a shortage of quality used cars that car dealers are now competing with auto recyclers to purchase wrecked, or "total loss" vehicles at insurance auctions. These dealers then repair these vehicles and attempt to sell them to consumers as quality used cars, when in reality they are literally nothing more than rebuilt wrecks with "salvage" titles.

From a consumer standpoint, car buyers are unknowingly paying full retail price for salvaged, or "total loss" vehicles that are often worth only a small fraction of NADA retail value, at best! In the worse case scenarios, many of these repaired vehicles may not be safe, and families all over the country could be driving vehicles with compromised crumple zones, damaged suspensions, disabled safety features, non functioning air bags, and even miss-aligned drive trains that contribute to poor safety, poor fuel economy, and excessive mechanical wear.

From the auto recycling industry standpoint, when car dealers bid up the price of total loss insurance vehicles, this takes parts vehicles out of the market and creates a shortage of good used parts available to automotive repair and body shops. In addition, it drives up the cost of inventory that auto recyclers are able to purchase, thereby forcing recyclers to raise the price of salvaged parts and to further cut costs in order to stay in business.

Basically, this program has evolved into a loose-loose situation for all parties involved. Consumers get substandard merchandise, car dealers have to fix and sell wrecks because there are no good used cars available to buy and resell, and auto recyclers can't get the inventory they need and are forced to raise prices and cut costs. Unfortunately, this was a hard lesson learned that any time the government intervenes in the private market, such as is the case with the cash for clunkers programs, it completely throws the natural market factors out of whack and often causes far more problems that anyone could have possibly envisioned. What started out as a bailout for the automakers has now severely damaged the used car and auto recycling industry in the United States.

We have kept our FAQ page on the internet for historical and reference purposes. Please feel free to read the FAQ below to see exactly how the program worked.


Historical Introduction

We have been receiving many questions regarding the new "Cash For Clunkers", A.K.A. "Car Allowance Rebate System" ever since it was implemented on July 1st 2009. Due to the volume of requests, we have decided to include this small FAQ (frequently asked questions) section on our site. After carefully reviewing the program and the disposal requirements, LAS has decided to service our new car dealer customers by accepting and recycling the vehicles traded in for this program. Please review the FAQ section below for more details.


Dealer FAQ

  • Is LAS on the government list of approved recyclers to accept CARS trade-ins? -- Yes. Because we participate in the ELVS (End Of Life Vehicle Solutions) mercury switch recycling program, we are certified by the NHTSA (National Highway Transportation Safety Administration) to accept and recycle these trade-in vehicles.

  • Does LAS have the capability to recycle CARS trade-ins according to government regulations? Yes, we recycle motor oil, transmission fluid, differential oil, lead-acid batteries, mercury switches, engine coolant, and AC refrigerants in accordance with EPA and SC DHEC regulations.

  • How much do you pay for vehicles scrapped under this program? -- Most of our participating new car dealers prefer a "fixed payment" for each car we purchase under this program. It keeps paperwork simple and the dealer knows exactly how much "scrap value" to allow each consumer above and beyond the $50.00 the dealer can keep for program administration costs. Please contact Mr. Paul Eschenbach for more pricing details.

  • Who is responsible for "seizing" the engines on these trade-ins; the dealer or the disposal facility? -- According to "The Rule" released on July 25th, the dealer must seize the engines and certify they have done so before turning them over to the disposal facility (recycler). We recommend that dealers wait until the trade-in has been approved for a CARS credit before destroying the engine.... otherwise you might have to buy the car from your customer if it is rejected for the credit.

  • Will LAS provide us with the proper forms & documentation required for this program? -- Yes, we provide a portfolio containing all of our licenses & certifications, as well as all documentation required for the program.

  • Does LAS report their salvage vehicles, including CARS trade-ins to the NMVTIS? -- Yes, we report all vehicles we purchase, including CARS trade-ins, to the NMVTIS (National Motor Vehicle Title Information System) via a data consolidator approved by the DOJ (Department of Justice).

  • Will LAS "crush" the CARS trade-ins as required by the program? -- Yes. According to "The Rule", all vehicles disposed of under this program must be "crushed" or "shredded" within 180 days upon receipt from the dealer. Because we specialize in parts, we will dismantle as many parts as we can from each vehicle before destroying them. Never the less, what ever is left on the vehicle after 180 days, along with the engine and the shell (containing the VIN), will be destroyed at our facility.


Consumer FAQ

  • What cars qualify for the credit? -- Basically the car must be less than 25 years old, must have been registered and insured for the last year, and get a combined EPA fuel mileage of 18 MPG or less.

  • My car has a salvage title, does it qualify for Cash for Clunkers? - We at LAS have read all 136 pages of the law (hey, that's more than most members of congress, and we just run a junk yard!) and no where does it say anything about a salvage title disqualifying a car for the rebate. It does say the title must not have any leans against it, and that it must be owned by you and registered by you for at least one year, salvage title or not.

  • My car knocks, smokes, leaks and the transmission slips. Does it still qualify? -- Your car only needs to run well enough to drive into the dealership where you wish to buy your new car. It doesn't matter how bad it runs, leaks, smokes, or how loud it is. Just as long as it meets all of the other requirements.

  • How do I get the money from the Government? -- You must buy or lease a new car, not a used one, a brand new one. Take your car to a registered new car dealer and let them fill out the paperwork for your credit. You don't receive any money, the dealership does.

  • How much money can I get? -- Nothing! You don't get the "cash" for your "clunker", the dealer does. However, the dealer will knock off $3,500.00 if your new car gets 4 MPG better than your old one or will knock off $4,500.00 if your new car gets 10 MPG better than your old one.

  • Do I get to keep the money the salvage yard pays for the vehicle? -- This is a "grey area" that was not made clear by the NHTSA, however, the dealers in our recycling program are treating any money received from us for the scrap price of the vehicle as a "scrap rebate" off the price of the car. Just don't expect much! In almost EVERY case the "scrap rebate" you receive (if any) will be under $100.00

  • Why is the scrap value so low? -- There are many reasons why these vehicles are almost worthless, but the main reason is because the dealer is required by law to destroy the engine in your car after you trade it in, thereby taking away the number one item recyclers sell to recover the price of the vehicle and the overhead to process it. Other reasons include the enormous amount of paperwork and reporting the government is requiring auto recyclers to perform, the extra staff required to handle the extra dismantling load, the short time line we have to dismantle the vehicles (just 180 days), and the infrastructure we must build to house the dismantled parts.

  • Do I still get "incentives" at dealers if I get the CARS credit? -- That's up to each car company and individual car dealership, however, the answer is "yes"; you get to keep all advertised incentives and rebates offered by the dealer.

  • Can I turn my car into a "junk yard" and get my credit? -- No.

  • Can I buy a used car and get my credit? -- No. As stated, it must be a new car and purchased at a registered dealership.

  • Can I lease a new car and still get the credit? -- Yes. See your local car dealer for more info!

  • Does my car have to run to qualify for the credit? - Yes, it must be drivable.

  • I WANT to buy a new car and trade in my old car for credit! How can I find out more? -- Go to the official government website at http://www.cars.gov/ to find out if your car qualifies.

  • I can't afford a new car and want to junk mine. Where do I go? -- Click here to find out how to  get cash for your junk car.


 

 

 



 

Attention New Car Dealers!!!

The one billion dollars allocated to the CARS rebate system is going fast! Let Laurens Auto Salvage recycle these rides so you can submit your trade-ins for credit now!

Call us TODAY before it's too late!

 

1-800-922-4033

 


 

 




 

   

 
 

USED TIRES SOLD HERE FROM JUST

$10.00 EACH!

Copyright 2007-2014 Laurens Auto Salvage

1471 Fleming Street Extension

Laurens, SC 29360

Toll Free: 1-800-922-4033

Office: 1-864-984-6574

Email: sales@laurensautosalvage.com

 

 

QUALITY NEW BLEMISHED BATTERIES SOLD HERE! JUST $54.99 exchange!