Released: June 25, 2009

‘Cash for Clunkers’ mostly a clunker

Source: Peter Valdes-Dapena, CNNMoney

If you think the new “Cash for Clunkers” law is going to help you buy a new car, you’re probably wrong. As it’s written, the law will benefit few car shoppers and those who might actually benefit from it probably shouldn’t be buying a new car to begin with.

Here’s why it won’t do most people much good: The government refund vouchers for $3,500 or $4,500 are in replacement of—not in addition to—the ordinary trade-in value of the vehicle, which in many instances will be worth more than the voucher.

“It’s not a rebate,” pointed out Jeremy Anwyl, chief executive of the auto Web site Edmunds.com. “It’s a minimum trade-in allowance.”

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