The NEW Vehicle


Whether or not your new vehicle qualifies for a voucher--and if so, how much that voucher is worth--depends on the EPA mpg rating and the sticker price.

First, the voucher cannot be used on a vehicle with a retail price of more than $45,000. It can be applied to a leased vehicle, but the lease has to be for five years or longer.

After that, it gets a little more complicated, as the required mpg rating and the value of the voucher depend on the type of vehicle you want to buy.

To get either a $3,500 or $4,500 voucher:
  • A car must have a combined EPA rating of at least 22 mpg. (You can use the same www.fueleconomy.gov link as above to find the mpg of the new vehicle.) If the new vehicle gets 4 to 9 mpg more than the old one, it earns a $3,500 voucher. If it gets 10 mpg more or better, it earns a $4,500 voucher.

  • A light truck (SUV, minivan, or small pickup) must have a combined EPA rating of at least 18 mpg and be rated at least 2 mpg more than the old vehicle to earn a $3,500 voucher. If it gets 5 mpg more or better, it earns a $4,500 voucher.

  • A large light-duty truck must have a combined EPA rating of at least 15 mpg and be rated at least 1 mpg better than the old vehicle to earn a $3,500 voucher. Also, the trade-in has to be either another large, light-duty truck or a heavy-duty truck. (Large, light-duty trucks have a Gross Vehicle Weight Rating of less than 8,500 lbs, and are defined as pickups with a wheelbase greater than 115 inches and vans with a wheelbase greater than 124 inches. As such, it includes most extended- and crew-cab compact pickups and most full-size pickups and vans. Heavy-duty trucks have a GVWR of 8,500 to 10,000 lbs.) If the new truck gets at least 2 mpg more than the old one, it earns a $4,500 voucher, but the trade-in has to be another large, light-duty truck; if it’s a heavy-duty truck, it still earns just a $3,500 voucher.
It is perhaps no coincidence that the date window of this program coincides with the “model-year closeout” for 2009 vehicles and the introduction of many 2010s, and most dealers have a glut of 2009s they need to sell. (Some dealers may not sign up for the voucher program; you have to check with them.) Note that the value of the voucher is deducted from the negotiated price of the car much like a factory rebate, and the money goes to the dealer sometime after the transaction has been completed. Since this process can be a bit confusing, let’s look at an example.

Heavy-duty Pickups or Vans
If you have or are buying a heavy-duty pickup or van--defined as having a Gross Vehicle Weight Rating of 8,500 to 10,000 lbs--the rules are different. The maximum voucher is $3,500, and the trade-in has to be a similar-size truck that is less than 25 years old but no newer than the 2001 model year.
Let’s say you have a large 1988 SUV rated at 18 mpg--a prime candidate for the program--and want to buy a fuel-sipping compact car that averages 28 mpg. That combination clears the hurdles for the $4,500 voucher.

The new car has a retail price of $20,000. But you know (hopefully by checking our website) that it has an invoice price of $18,500, plus there’s a $2,000 factory rebate on it. So you negotiate the price down to the $18,500 invoice (don’t worry; the dealer gets other money from the manufacturer you don’t necessarily know about, so he’s still making a profit), and then take off the $2,000 rebate. Now you’re down to $16,500. Then you subtract the $4,500 value of the voucher, so you’re getting that $20,000 car for $12,000. Plus, you might get additional money back for your old vehicle’s scrap value.

In the end, you’ve not only gotten a new car that pollutes far less and uses far less fuel, but you’ve also helped keep some autoworkers, and perhaps an entire auto company, in the black. Are you one of the lucky people the Cash for Clunkers program was designed to help?