From a news release issued by the U.S. Department of Transportation:
U.S. Transportation Secretary Ray LaHood today kicked off a buyer incentive program designed to help consumers purchase new fuel efficient vehicles and boost the economy at the same time. The Car Allowance Rebate System (CARS), commonly referred to as Cash for Clunkers, is a new federal program that gives buyers up to $4,500 towards a new, more environmentally-friendly vehicle when they trade-in their old gas guzzling cars or trucks.
“With this program, we are giving the auto industry a shot in the arm and struggling consumers can get rid of their gas-guzzlers and buy a more reliable, fuel-efficient vehicle,” Secretary LaHood said. “This is good news for our economy, the environment and consumers’ pocketbooks.”
The National Highway Traffic Safety Administration (NHTSA) also released the final eligibility requirements to participate in the program. Under the CARS program, consumers receive a $3,500 or $4,500 discount from a car dealer when they trade in their old vehicle and purchase or lease a new, qualifying vehicle. In order to be eligible for the program, the trade-in passenger vehicle must: be manufactured less than 25 years before the date it is traded in; have a combined city/highway fuel economy of 18 miles per gallon or less; be in drivable condition; and be continuously insured and registered to the same owner for the full year before the trade-in. Transactions must be made between now and November 1, 2009 or until the money runs out.
The vehicle that is traded in will be scrapped. NHTSA estimates the program could take approximately 250,000 vehicles that are not fuel efficient off the road.