Cash for Clunkers Car Buying Stimulus Program

By Philip Reed, Senior Consumer Advice Editor

Date Posted: August 25, 2009, 07:08 pm PDT

For a list of vehicles eligible for the Cash for Clunkers program:
Click here to see new vehicles eligible for purchase
Click here to see used vehicles eligible for trade-in

Read breaking Cash for Clunkers news on Auto Observer

For shopping tips for consumers during this final weekend, read our Edmunds Daily blog post.

Cash for Clunkers — now officially known as the Car Allowance Rebate System (CARS) — will be ending Monday, Aug. 24, at 8 p.m. ET. The Cash for Clunkers 2009 program was signed into law by President Obama on June 24, 2009 with a goal of encouraging consumers to trade in older, less fuel-efficient vehicles for new vehicles that get better fuel economy by providing a credit of either $3,500 or $4,500. There are also credits available for some very large vans, SUVs and pickup trucks irrespective of their fuel economy. Modeled after several programs that have already been successfully implemented in Europe, the Cash for Clunkers program was originally supposed to end on November 1, 2009 (or the date the funds allocated to the program were exhausted). However, the government has decided to end the program on August 24, 2009 due to concerns that the program is running out of money.

The National Highway Traffic Safety Administration (NHTSA) was tasked with hashing out the details and implementing the Cash for Clunkers program.

The program divides cars, trucks, SUVs and vans into four categories, in most cases based on weight and length of their wheelbase. Vehicles that are traded in are to be destroyed, not resold, and the base manufacturer's suggested retail price of the new replacement vehicle cannot exceed $45,000. Miles-per-gallon (mpg) figures set out below refer to the EPA's published "combined" mpg.

If you have a used vehicle you want to trade in that is worth more than $4,500, the Cash for Clunkers program will probably not make financial sense for you.

We recommend that you use our Cash for Clunkers calculator to evaluate whether you might want to take advantage of the program. You may also find it helpful to review the following chart in which we show, for each category of used vehicle, the mileage requirements to receive a credit (and the amount of the credit).

Cash for Clunkers at a Glance

What Are the mpg* and Vehicle Category Requirements?
If my trade-in vehicle is a...	Then the new vehicle I buy must be a ...	*My new vehicle must get an mpg of at least ...**	*My new vehicle's mpg must be higher than my trade-in vehicle's mpg* by...**	And the credit will be...
Passenger Automobile (must have an mpg* of 18 or less)	Passenger Automobile	22 mpg*	4-9 mpg*	$3,500
	Passenger Automobile	22 mpg*	10 mpg* or more	$4,500
	Category 1 Truck	18 mpg*	2-4 mpg*	$3,500
	Category 1 Truck	18 mpg*	5 mpg* or more	$4,500
Category 1 Truck: (must have an mpg* of 18 or less) SUVs with a GVWR† of less than 8,500 pounds (Chevrolet Blazer, Ford Explorer, etc.) Pickups with a GVWR† of less than 8,500 pounds and a wheelbase^ of 115 inches or less (Ford Ranger, Toyota Tacoma, etc.) Passenger vans and cargo vans with a GVWR† of less than 8,500 pounds and wheelbase^ of 124 inches or less (Dodge Caravan, Honda Odyssey, etc.)	Passenger Automobile	22 mpg*	4-9 mpg*	$3,500
	Passenger Automobile	22 mpg*	10 mpg* or more	$4,500
	Category 1 Truck	18 mpg*	2-4 mpg*	$3,500
	Category 1 Truck	18 mpg*	5 mpg* or more	$4,500
Category 2 Truck: (must have an mpg* of 18 or less) Pickups with a GVWR of 8,500 pounds or less and a wheelbase^ greater than 115 inches (Ford F-150, Chevy Silverado, etc.). Passenger vans and cargo vans with a GVWR of 8,500 pounds or less and a wheelbase^ greater than 124 inches	Passenger Automobile	22 mpg*	4-9 mpg*	$3,500
	Passenger Automobile	22 mpg*	10 mpg* or more	$4,500
	Category 1 Truck	18 mpg*	2-4 mpg*	$3,500
	Category 1 Truck	18 mpg*	5 mpg* or more	$4,500
	Category 2 Truck	15 mpg*	1 mpg*	$3,500
	Category 2 Truck	15 mpg*	2 mpg* or more	$4,500
Category 3 Truck: Very large vans, SUVs and pickup (cargo bed of 72 inches or more) trucks w/ GVWR† 8,500-10,000 pounds (Chevrolet C/K 3500, Ford F-350)	Category 2 Truck	15 mpg*	NA‡	$3,500
	Category 3 Truck	NA‡	However, the new vehicle must be similar in size or smaller than the trade-in	$3,500

Source: fueleconomy.gov
*mpg requirements are based on EPA's published new combined city/highway ratings.
†GVWR means Gross Vehicle Weight Rating
‡Not Applicable; Category 3 Trucks do not have EPA mpg ratings
^Note that the wheelbase used to determine truck category by the program is the shortest wheelbase for a given nameplate and may not correspond to your vehicle's actual wheelbase, especially in the case of trucks with extended cabs.

Basic Eligibility Requirements
Trade-in Vehicle	Is in drivable condition Has been registered in your name and insured consistent with state law continuously for at least one year, immediately prior to the trade-in date Was manufactured less than 25 years before the month you trade in your vehicle (for example, if you trade in your vehicle any time in August 2009, your trade-in must have been manufactured in August 1984 or after); and in the case of Category 3 Trucks, it must be a pre-2002 model -year vehicle. Has a combined mpg of 18 or less (except for Category 3 Trucks, for which there is no mpg requirement)
New Vehicle (Purchased or Leased)	Is new (i.e., legal title has not been transferred to anyone) Has a base manufacturer's suggested retail price of $45,000 or less (i.e., the price on the window sticker before any dealer accessories, optional equipment, taxes or destination charges are added)

Basic Eligibility Requirements

Trade-in Vehicle

Is in drivable condition
Has been registered in your name and insured consistent with state law continuously for at least one year, immediately prior to the trade-in date
Was manufactured less than 25 years before the month you trade in your vehicle (for example, if you trade in your vehicle any time in August 2009, your trade-in must have been manufactured in August 1984 or after); and in the case of Category 3 Trucks, it must be a pre-2002 model -year vehicle.
Has a combined mpg of 18 or less (except for Category 3 Trucks, for which there is no mpg requirement)

New Vehicle
(Purchased or Leased)

Is new (i.e., legal title has not been transferred to anyone)
Has a base manufacturer's suggested retail price of $45,000 or less (i.e., the price on the window sticker before any dealer accessories, optional equipment, taxes or destination charges are added)

Description of Vehicle Categories

Passenger Automobiles: A regular passenger car. The law defines it as: An automobile manufactured primarily for use on public streets, roads and highways with less than 10,000 GVWR and for transporting not more than 10 individuals, but does not include Category 3 Trucks and automobiles that are capable of off-highway operation or are not manufactured primarily for transporting persons.

Category 1 Truck: This category includes sport-utility vehicles (SUVs), small and medium pickup trucks, minivans, and small and medium passenger and cargo vans with a GVWR less than or equal to 8,500 pounds. The law defines it as: A non-passenger automobile other than a Category 2 or Category 3 Truck.

Small and medium pickup trucks are defined as those having a wheelbase of 115 inches or less. Small and medium vans are defined as those having a wheelbase of 124 inches or less.

Note that the wheelbase used to determine truck category by the program is the shortest wheelbase for a given nameplate (e.g., Ford F-150) and may not correspond to your vehicle's actual wheelbase, especially in the case of trucks with extended cabs.

Category 2 Truck: These are large pickup trucks such as the Ford F-150 and Toyota Tundra, and large vans such as the Ford Econoline with a GVWR less than or equal to 8,500 pounds.

Large pickup trucks are defined as those having a wheelbase greater than 115 inches, and large vans are defined as having a wheelbase greater than 124 inches.

Category 3 Truck: These are very large vans, SUVs, pickups and work trucks (with a cargo bed of 72 inches or more in length), such as the Ford F-350, with a GVWR greater than 8,500 pounds and less than 10,000 pounds. To be eligible as a trade-in, a Category 3 Truck must be a pre-2002 model.

A Category 3 Truck can only be traded in for a Category 2 Truck that has a combined mpg of 15 or more, or for a Category 3 Truck that has a GVWR that is not more than the GVWR of the trade-in vehicle.

The only credit available when the trade-in is a Category 3 Truck is $3,500 — and there are a limited number of these credits available under the program. The EPA does not publish mpg ratings for Category 3 Trucks; however, because newer models are cleaner than older models, the age requirement ensures that the trade will improve environmental quality.

Note that the wheelbase used to determine truck category is the shortest wheelbase for a given nameplate (e.g., Ford F-150), and may not correspond to your vehicle's actual wheelbase — especially in the case of trucks with extended cabs.