Only in America.

[hbj069]

The Plan, The Scam, The Man,
Don't ya just love it when a plan comes together?

Ignore all the gas crap and just look at how the stupid car buyer got taken to the cleaners:

If you traded in a clunker worth $3500, you get $4500 off for an apparent "savings" of $1000.

However, you have to pay taxes on the $4500 come April 15th (something that no auto dealer will tell you). If you are in the 30% tax bracket, you will pay $1350 on that $4500.

So, rather than save $1000, you actually pay an extra $350 to the feds. In addition, you traded in a car that was most likely paid for. Now you have 4 or 5 years of payments on a car that you did not need, that was costing you less to run than the payments that you will now be making.

But wait; it gets even better: you also got ripped off by the dealer.
For example, every dealer here in LA was selling the Ford Focus with all the goodies, including A/C, auto transmission, power windows, etc for $12,500 the month before the "cash for clunkers" program started.

When "cashfor clunkers" came along, they stopped discounting them and instead sold them at the list price of $15,500. So, you paid $3000 more than you would have the month before... (Honda, Toyota , and Kia played the same list price game that Ford and Chevy did).

So let's do the final tally here:

You traded in a car worth: $3500
You got a discount of: $4500
---------
Net so far +$1000
But you have to pay: $1350 in taxes on the $4500
--------
Net so far: -$350
And you paid: $3000 more than the car was selling for the month before
----------
Net -$3350

We could also add in the additional taxes (sales tax, state tax, etc.) on the extra $3000 that you paid for the car, along with the 5 years of interest on the car loan, but let's just stop here.

So who actually made out on the deal? The feds collected taxes on the car along with taxes on the $4500 they "gave" you. The car dealers made an extra $3000 or more on every car they sold along with the kickbacks from the manufacturers and the loan companies. The manufacturers got to dump lots of cars they could not give away the month before. And the poor, stupid consumer got saddle d w ith even more debt that they cannot afford.

Obama and his band of merry men convinced Jo e consumer that he was getting $4500 in "free" money from the "government" when in fact, Jo e was giving away his $3500 car and paying an additional $3350 for the privilege.

Think this was stupid for those who were crazy enough to swallow this wonderful scheme?

Just wait until we get health care with no additional costs over what most of us now pay for health insurance and the best medical care in the world. Think that scheme might be designed by the same people who came up with Cash for Clunkers?

 

[tinsoldier]

I hated the idea of that program, but did you check the facts before cutting and pasting a chain email? Maybe I am missing something?

http://www.cars.gov/faq#category-06

Is the credit subject to being taxed as income to the consumers that participate in the program?

NO. The CARS Act expressly provides that the credit is not income for the consumer.

As for the dealer price lists.. meh, who knows if that's true but caveat emptor and all that.

also, there isn't a 30% tax bracket

 

[team3six]

yeah that letter is B.S. that was going around.

Dealers were not allowed to jack up the costs at all, and you can always compare rates online across the country. the only thing you could possibly fake out and even then it wouldnt be that much of an increase is adding all the ups an extras that dont need to be on the car/truck.

Something that is fact though. NO DEALERSHIP has yet to be paid from the government for the cluckers program on trades. As a matter a fact, The GM delaership has about 200 hundred cars still sitting in their pen from that program.

And the new program thats about to hit is cash for aplliances. Yup that is true.

 

[slobin3d]

yeah that letter is B.S. that was going around.

Dealers were not allowed to jack up the costs at all, and you can always compare rates online across the country.

Yes that letter is crap. But I would have to agree on the dealers jacking up prices, weather its legal or not. My local Lithia had Aveo's listed for 9995, for months, when the Clunkers came along they mysteriously shot up to 12,500.... regardless I didn't buy either, No money and my trade in was too old and got too good of mileage:mrgreen:

 

[team3six]

yeah but remeber before the cash for clunkers thing happened. dealers across the country had dealer cost going on to try and save them. after the cash program was signed. the delers cost was dropped and it went back to the original manufacturer cost.

Its not the dealers that set the cost, its the auto manufacturer. You can always deal with dealers though, generally at the most you can get $5000.00 off the price of the car/truck without all the discounts and deductions.

I used to work for a delaership about 12 years ago. Hated it, The commisions sucks, I cant imagine what it is now adays being a car dealer in these times. most of the time if you dont sell a certain quota, they just get rid of you.

 

[hbj069]

yeah that letter is B.S. that was going around.

Dealers were not allowed to jack up the costs at all, and you can always compare rates online across the country. the only thing you could possibly fake out and even then it wouldnt be that much of an increase is adding all the ups an extras that dont need to be on the car/truck.

Something that is fact though. NO DEALERSHIP has yet to be paid from the government for the cluckers program on trades. As a matter a fact, The GM delaership has about 200 hundred cars still sitting in their pen from that program.

And the new program thats about to hit is cash for aplliances. Yup that is true.

WHO CARES ? Its funny

 

[hbj069]

yeah but remeber before the cash for clunkers thing happened. dealers across the country had dealer cost going on to try and save them. after the cash program was signed. the delers cost was dropped and it went back to the original manufacturer cost.

Its not the dealers that set the cost, its the auto manufacturer. You can always deal with dealers though, generally at the most you can get $5000.00 off the price of the car/truck without all the discounts and deductions.

I used to work for a delaership about 12 years ago. Hated it, The commisions sucks, I cant imagine what it is now adays being a car dealer in these times. most of the time if you dont sell a certain quota, they just get rid of you.

If you worked at a dealership then surely you know about the pac money. And that the fact that dealers pay way less for them rides than what you think. And anytime you think your paying invoice and they are only making $98 per car then I got some real deals for ya:mrgreen:

 

[team3six]

OK, Ill just leave this alone. didnt want it to become a huge political showdown.

 

[hbj069]

OK, Ill just leave this alone. didnt want it to become a huge political showdown.

with ya brother. Just thought it was funny.