Cash For Clunkers Seems to be Working in New Hampshire

When you call the number for the Car Allowance Rebate System, or CARS, you’re likely to get this:

"Thank you for calling the Department of Transportation’s Cars information hotline. We are currently experiencing an unusually high call volume. Please stay on the line to speak to an agent…(fade)"

The reason….is this.

"We have at this point registered almost 16,000 dealers across the country and then over the weekend our hotline got something close to 46000 calls from consumers asking questions about it."

Ray Tyson is with the National Highway Traffic Safety Administration which is running the CARS Program.

"And the website had about a million and a half hits so obviously there is a incredible amount of interest out there both on the part of the dealers and consumers."

You may know the CARS program by its catchier nickname, Cash for Clunkers.

It works like this.

First, you need to own a vehicle that gets 18 miles to the gallon or less,

It’s got to be younger than 25 and you must have had it insured for the past year.

Take it to a participating dealer as part of a trade-in for a new vehicle that gets better mileage and the federal government will give you a rebate up to 45 hundred dollars.

The size of the rebate depends on how much better mileage your new purchase gets in comparison to the old one.

One motive for the program was to get people to trade in their higher polluting gas guzzlers.

And David McGreevy says the program is off to a good start.

He’s the Marketing Director for the Auto Serve Dealership in Tilton.

" We are seeing some very large SUVs and some vehicles that were very fuel inefficient being traded in for some very economic models, not only from a fuel economy standpoint but also of people’s budgets and we’re pleased to report that the program seems to be working just as proscribed."

He says so far, they’ve accepted 14 vehicles in the program and have other customers interested.

In one case, he says, a customer traded a Chevrolet Suburban, which gets around 15 miles to the gallon for a Nissan Versa, which comes in around 34.

Another motive behind Cash for Clunkers was to generate car sales during this tight economy.

And Pete McNamara, President of the New Hampshire Auto Dealers Association , says that appears to be working too.

"They’re definitely making sales. I talked to one dealer at a seminar we had and he had 50 sales at one store and he had another 36 at two other stores that were directly tied to cash for clunkers."

To be clear, those sales were not just since Friday when the program officially started.

Auto Dealers have been piling up the deals waiting for the final rules to come out to register them.

Still McNamara says this won’t be a huge boost to auto dealers during the sagging economy, but it may provide that extra umph if someone is thinking about buying a new car.

There’s another industry that stands to make some money on Cash for Clunkers.

Those old cars have to go somewhere.

The engines are to be destroyed so they can’t be put back on the road.

So the process needs guys like Mike Dawson at Lamberts Auto in Rochester.

He’s one of the people who sends those cars to their final resting place.

"We go get it, we prep them all, we crush em, we load them on tractor trailers, we send them all to Thompson Maine, they shred it, ship it back to the port in Portsmouth and most of it ends up in India and Turkey, I’d say 90% of it ends up in Turkey."

And if everything is working as it should, everyone along the way is making a little on the deal.

One business may find there’s a downside to the CARS program.

Used car dealers are likely to see less inventory, especially on the low end vehicles.

The Cash for Clunkers program doesn’t last forever.

It runs through October this year, or 1 billion dollars in rebates, whichever comes first.

But at an average of 4000 dollars per clunker traded in, that works out to about 250 thousand gas guzzlers taken off the road.

For NHPR News, I’m Mark Bevis.