'Cash for clunkers' slows car donations to charities

= You used to hear it all the time. Whenever someone raised the question of what to do with a near-worthless rust bucket, the answer almost always came back the same -- donate it to charity.

Since the arrival of "cash for clunkers," however, donations have dropped off. It's not hard to imagine why -- a $3,500 or $4,500 voucher is certainly more appetizing to the cash-strapped recession-era new car shopper than a tax writeoff come year's end.

The damage has not been insignificant. According to the Associated Press, a Texas-based charity estimates that the cash for clunkers program has already cost it $75,000 in missed vehicle donations. Unfortunately, instead of being sold for charity funds or turned over to needy families, formerly donation-worthy cars will be sent to the crusher with seized engines, per the program's stringent guidelines.

Despite a slowdown since its inception, the federal program has succeeded in sending consumers to dealerships. According to a survey of 517 in-market shoppers by Kelley Blue Book (KBB), the cash for clunkers program has persuaded 1 in 10 shoppers to purchase a new vehicle sooner. Taking into account that many trade-ins don't qualify for the cash for clunkers voucher, charities may see some relief yet. But when you consider that owners of particularly rundown vehicles will be looking at either a low-value tax writeoff or a $4,500 discount on a new car, the decision-making process becomes pretty clear.

Thinking of donating a clunker of your own? Check out this firsthand experience of a Land Rover-to-Nissan Cube swap and get an idea of what you'll be dealing with.

-- Brian Alexander

Brian Alexander is a staff writer at DriverSide.com

'And the teen shall inherit the SUV'

One of the time-honored ways that a young driver gets his or her first set of wheels is when their parents decide not to trade in the old car and give it to the young kid instead. With the flood of SUVs on the market over the last 20 years, many of those vehicles now park at the high school instead of the office. But what is an easy way to get Jason and Jennifer their wheels may spell more accidents, according to an article by Abraham Sauer on theawl.com. 

Sauer backs up his thesis with a truckload of statistics. Price is the deciding factor in the majority of teen car purchases. Right now within three miles of here, there are a half dozen mid-1990s SUVs for sale for under $4,000. Add the uniquely challenging driving characteristics of these vehicles, the poor track record for teen drivers in general and the prospects don’t look good. The only bright point is that most of the 'cars for clunker' trade-ins are SUVs. This may be the silver lining in what looks like a future of teen SUV-driving danger.

Factor in texting while driving (not confined to teens alone, certainly), the passenger capacity and the numbers of young drivers who don’t wear seat belts, and you get a recipe for highway disaster. 

-- Doug Stewart

Photo: 1991 Ford Explorer

Photo credit: Ford

Don't want a new car? Check out this low-mileage baby

One of the reasons new-car sales are in such a deep hole is that dealers are steering customers toward used vehicles, according to a new study by automotive data tracker Edmunds.com.

About 511,000 used cars sold during the last three months would likely have been rung up as new-car sales during “normal” economic times, Santa Monica-based Edmunds.com reported.

Two-thirds of those consumers usually buy a new vehicle, but opted instead for a used vehicle because of the tough economic times.

The remaining third went into the buying process intending to buy a new car but at some point switched to a used car, which typically can generate twice as much profit for the dealer as selling a new car.

"Right now, dealers need to maximize their short-term profitability more than ever," Edmunds.com Chief Executive Jeremy Anwyl said.

"So it is really no big surprise to learn that salespeople are directing some car buyers toward used cars, which have historically delivered a much higher profit margin to the dealer."

AutoNation, which owns dealerships in more than a dozen states, said used-car sales have been a rare bright spot lately.

"We're positioning people to get them in the vehicle that fits their needs in this economy," AutoNation spokesman Marc Cannon said. "And if new doesn't fit their needs, we'll put them in used.

"We don’t want them walking out the door without a car."

Falling home prices and the collapse of the stock market, as well as tight credit conditions and job insecurity related to the recession, have caused new-car sales to plummet over the last several months. New vehicle sales in the U.S. were down 37% in January compared with a year ago, forcing automakers to slash production and driving hundreds of dealers out of business.

Toyota rolls out hybrid CPO program

What’s better than a used hybrid? Toyota believes it’s a certified pre-owned (CPO) hybrid. It seems folks aren’t aware hybrid Toyotas are available as CPO cars, and Toyota would like to change that trend. “We’ve already sold 30,000 hybrids to date on this program, but we’ve found that consumers have low awareness that hybrids are included in our CPO cars,” explained Steve Gallagher, Toyota certified used vehicles marketing manager.

The program, announced this morning, is called the Toyota Certified Used Hybrid (TCUH), an extension of the existing Toyota Certified Used Vehicles (TCUV), and it provides inspection points and extended warranty coverage on all certified used Toyota hybrids.

What’s the difference? Toyota tells us it’s 14 inspection points that affect the components running adjacent to the internal combustion system. These checkpoints include the multi-informational display, inverter coolant levels, electric motor assisted power steering and the hybrid vehicle battery.

The program has its own easy-to-navigate consumer website, where we found eight Pruises of varying years with prices ranging from the high-$14,000s to mid-$20,000s. After making several calls to the related dealerships, however, we found not one sales manager who knew the program existed. Gallagher explained this phenomenon: “We’ve just rolled out the program on the dealerships’ internal newsletter yesterday, and sometimes it takes a few days to get the word out.”

All this is understandable when you consider Toyota has over 1,200 dealerships in the U.S. alone, but when we asked how the current hybrid cars in the program could have been inspected for all 14 checkpoints without the dealers involved, Gallagher explained: “The checkpoints were already established as a part of our existing certified program.”

So, bottom line: Great new website, but in reality, it’s the same program you could have gotten yesterday. But now you’re more aware of it, right?

-- Joni Gray

Photo credit: Toyota

Bugatti for sale -- Craigslist's most expensive car listing?

This could be one of those “I wish I’d bought it while I had the chance” moments. Or maybe not. A 2006 Bugatti Veyron, with only 874 miles on the odometer, is up for sale. On Craigslist.

It’s on the Los Angeles CL site, but the car is located upstate in Benicia, just north of San Francisco -- which isn’t that far away in a car that can zip to 60 mph in 2.5 seconds, hit 200 mph in 24 seconds and max out at 252.3 mph. It has one turbocharger for every four of its 16 cylinders, and its 8.0-liter displacement kicks out 1,000 horsepower, making it one of the most powerful production cars in the world. And the asking price? $1.3 million, probably the highest amount for a car ever put up on the whole of CL, although a Craigslist spokesperson was not available for comment.

Considering that a new Veyron goes for around $1.4 million, depreciation hasn’t hit too hard even in these troubled times. And each car is said to cost about $2 million to produce, so VW -- Bugatti’s parent company -- takes a huge loss just to make the most super of supercars.

If anyone from SoCal does end up buying it (the initials JL spring to mind), there’s always the Laguna Seca track on the way home, to give the car a really good shakedown. And isn’t there something gloriously cheapskate about advertising a $1.3-million car on a free classified ad site?

-- Colin Ryan

Bargain cars: Click here to see the cheapest cars of 2009.

Photo: Specialty Sales

L.A. Auto Show: Kelley Blue Book's Best Resale Value winners

Kelley Blue Book, the online and tangible guide to new and used vehicle information and pricing, has released its annual list of Best Resale Value Awards for the 2009 model year to coincide with the L.A. Auto Show.

Honda, which had the most vehicles with the best resale value and averages 44.5% of its MSRP at resale, reclaimed its title as best resale brand — an honor it shared with sister company Acura in 2007. (The automaker ranked fourth for the 2008 model year, with Volkswagen leading the pack. VW came in third for 2009).

The Kelley Blue Book list recognizes "current and upcoming vehicles for their projected retained value five years from now (the average ownership period)." Automotive market analysts tabulate the winners based on projections from the Kelley Blue Book Residual Value Guide. Check out this photo gallery of the top 10 resellers with specs and pricing and see these and winners in other categories after the jump.

EBay cars under $10,000 that beat the pants off a Nissan Versa

Nissan’s announcement last week that it would offer a stripped-down version of its Versa model for under $10,000 -– a Sub-Versa, if you will -– occasioned a lot of media attention and interest, as if there was something to celebrate. To me it sounds like 1.6 liters of boredom, a mouthful of sand to thirsty car-buyers. Please. Ten grand? I can put you in automotive paradise for $10,000. Walk this way.

Go to www.motors.ebay.com and follow the link to “Cars & Trucks.” Don’t specify a make or model but simply order the 50,000 or so listings by price, and use the advanced search function to specify items with a “Buy It Now” price. What you’ll discover is an Elysian field of depreciation as the awesome rides of yesteryear -– in some cases cars that dominated automotive buff book covers just a couple of years ago –- are dispensed with for a fraction of their original sticker. With the recent spike in gas prices and the downturn in the economy, people are eating their cars -– “literally!” as Joe Biden would say.

Yes, these cars are a little older, but if you were to compare, wheel-to-wheel, the new Versa with, say, a 1991 BMW 850i –- a 12-cylinder supercoupe on 18-inch Hamann wheels and with only 47,120 miles on the clock –- well, your head would explode. The Bimmer has more technology in its ashtray.

So before you submit to lowered automotive expectations, consider these choices, all on EBay for $10,000 or less (after the jump):