'Clunkers' Cashed In

Buyer Says Federal Bonus For Gas Hog 'Pulled The Trigger' For Deal

July 25, 2009|By Andrea K. Walker | Andrea K. Walker,andrea.walker@baltsun.com

Gary and Pat Block of Severna Park decided early this year that it was finally time to trade in their 20-year-old Ford Ranger pickup, but they were further enticed by the possibility of getting up to $4,500 from the government for their gas-guzzler.

"We were in the market and that pulled the trigger," said Gary Block. "We just couldn't walk away from the savings."

The couple bought a 2009 white Ford Ranger on Friday from Bob Bell Ford, Hyundai & Kia in Glen Burnie using the government's new "cash for clunkers" program.

The program gives consumers $3,500 or $4,500 off the purchase or lease of a new fuel-efficient vehicle if they scrap their older models. The law was passed by Congress a month ago, but dealers couldn't start registering until Friday, when anxious shoppers began taking advantage of the program.

The Blocks, who got $3,500 toward their purchase, visited several dealerships before settling on the Ranger.

Local car dealerships said there is a lot of interest in the program, which is designed to get more fuel-efficient cars on the road and give a boost to the struggling automobile industry. They've been fielding phone calls and have seen an increase in customers coming in to ask about the program.

Many of the dealers worry that the program, which is supposed to run through Nov. 1 or until the $1 billion in funding is gone, will run out of money sooner rather than later.

Some dealerships had allowed customers to put deposits on cars that they could pick up once the dealers were allowed to register. Hyundai started making short-term cash advances to dealers early this month to give to consumers trading in an old car for a new Hyundai.

The Sheehy franchise, which has 14 dealerships, sold about 100 cars before Friday, said Mike Harrison, executive manager of Sheehy Nissan in Glen Burnie. The dealership put a trash bin with an old Nissan Stanza poking out of it and "cash for clunkers" signs on the corner of Ritchie Highway and 6th Avenue in hopes of attracting even more buyers.

Harrison said business had started to pick up some before the government incentive, but that it is increasing even more now.

"This will help boost traffic and increase business even further," Harrison said.

Greg Hargrove, a 44-year-old golf course technician from Glen Burnie, had first heard about the program from his boss a month ago. He commutes 110 miles to and from work and was looking for a car that would cost him less in gas. Friday, he traded in his 2001 Dodge Ram for a gray Elantra with a sunroof from Bob Bell. He got $4,500 under the clunkers program.

"It sounded like a good deal," he said. "I had to come and check it out."

Not every car qualifies for the program. A trade-in vehicle must have a combined fuel economy rating of 18 miles per gallon or less. Many consumers are finding their clunkers aren't as bad as they thought and don't qualify for the program. A man came in to Bob Bell on Friday to replace his granddaughter's older-model Saturn only to find its gas fuel efficiency rating was too high.

Consumers are also being warned about scams associated with the program.

Michael Fitzpatrick, general manager for Bob Bell Ford, Hyundai & Kia, said that 20 percent to 30 percent of people asking about the program seem to qualify. He said he expected interest in the program to really pick up in the next couple of weeks as more people hear about it.

Customers can also get a tax break on their federal returns by deducting the sales tax on new vehicles purchased between Feb. 17 and the end of the year. It applies to the sales tax paid on the first $49,500 of a vehicle's price tag.

Chrysler also recently announced it would match the government's incentive or offer zero percent financing for consumers who turn in a clunker and buy a 2009 model. This Chrysler incentive runs through August and also will apply to trade-ins that don't qualify for the government program.

Bruce and Pat Lenderking of Pasadena wanted to get in on the program early, before word got out to too many people. The couple is trading in a 1997 Dodge Caravan for a blue Ford Fusion hybrid. They were attracted to the program because of the cash savings and its focus on fuel efficiency.

"We had a feeling this was going to be popular, so we wanted to come now and be in the queue," Bruce Lenderking said.

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