Read the August issue of Fixed Ops Journal, the parts,
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Congress must get clunker cash incentive right


Any cash for clunkers proposal must include certain requirements. First, the customer must demonstrate that he has held title to the vehicle for at least a year. Otherwise, people will be out buying vehicles to qualify for the government money, driving up the price of clunkers and having an adverse impact on lower income people who rely on these types of vehicles for basic transportation. Second, the vehicle must be in driveable condition up to and including the ability to pass a state safety inspection.

Even with these requirements two things will happen. The price of "clunker" vehicles will go up and the value of 2-3 year old used vehicles will go down. The 2-3 year old vehicles will go down in value because people taking advantage of this program will be able to buy a new car for significantly less than they could buy a 2-3 year old used car. Is it really in the best interest of the manufacturers to support legislation that will adversely affect the already abysmal resale value of their products?


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