Kevin Haberstroh, sales manager with B & B Auto Salvage, checks a work order while out in the salvage yard on Tuesday afternoon June 30, 2009. Haberstroh does not yet know how the role of salvage yards will play in to the government's new fuel-efficency incentive program. (Photo by Kristina Barker/Journal staff)
Joey Lore's car is lucky to have him.
In the past few years, he has replaced many of the 1992 Mercury Sable's parts and dutifully uses a stick of wood to prop up the hood.
If the temperature climbs above 90 degrees, the car's trunk will pop open, all by itself.
It's a grade-A, certified clunker.
"It's the most ridiculous thing I have ever seen," he said. "I have to have some tie wire on the ready, just in case."
Lore would like to turn in his old gas-guzzler for a voucher toward a new vehicle through the government's new "cash for clunkers" program. But the program's eligibility requirements lead some local auto dealers and salvage yard workers to wonder whether Lore will be left to rattle down the road.
The cash for clunkers program aims to boost the fortunes of the struggling auto industry, lure old, gas-guzzling vehicles off the road and replace them with new, more fuel-efficient vehicles.
The $1 billion voucher program, officially known as the Car Allowance Rebate System or CARS, was tucked into a military spending bill signed into law by President Obama last week.
The program should roll out in late July, according to the CARS Web site at cars.gov. The program would end Nov. 1.
The program will give those who turn in an old, gas-guzzling vehicle a voucher worth up to $4,500 toward a new vehicle, with the voucher's value based on the difference between the old and new vehicles' fuel efficiencies.
Kevin Haberstroh, sales manager of B&B Auto Salvage, said he and some co-workers at the Rapid City salvage yard looked up the ratings for some cars and found few fit into the program's requirements.
"We were just trying to role-play scenarios with different cars, (and) it just didn't seem like a big deal," he said.
Haberstroh is still uncertain what role salvage yards such as B&B will play in the government's program. The program aims to destroy engines with poor fuel
efficiency, but Haberstroh said it's not clear what car parts the government will allow for resale.
For some local dealers, it's still too early to know exactly how the program will work, but they're optimistic it will make a difference.
"Hopefully it will bring a few more customers," said Don Patnoe of Liberty Superstores in Rapid City.
At Toyota of the Black Hills, new car sales manager Joe Blomstrom is still waiting for details and hoping for the best.
"It'll be interesting to see how it will draw people in," he said. "We don't really have a clue on it yet, because the finalized deal isn't in on it yet."
The CARS program draws mixed reactions from South Dakota's congressional representation.
Republican Sen. John Thune bashed the program, which he helped fight off on the Senate floor, only to see it re-inserted in the military spending bill later.
"The government has already spent roughly $85 billion to prop up the auto industry, and this voucher program will further distort the market for both new and used car dealers," Thune said in an e-mail. "This is a very expensive gimmick with little environmental impact that adds $1 billion to our national debt."
Sen. Tim Johnson, a Democrat, initially voted for the measure's inclusion in the military spending bill, a move that lost by one vote. A conference committee later inserted the program in the bill.
"It is my hope the program is effective in jumpstarting our struggling auto industry, and I will be carefully monitoring its implementation," Johnson said in an e-mail.
Rep. Stephanie Herseth Sandlin, a Democrat, voted against the program in the House and said she was concerned about the program's cost, its failure to allow older vehicles and the exclusion of the sale of used cars with high fuel-efficiency.
Those concerns weren't discussed due to the way the bill advanced through the legislative process, she said.
"I recognize that our auto manufacturers and auto dealers are facing difficult economic challenges but I could not support the Cash for Clunkers bill that passed the House," she said.
So while dealers and salvage yards wait for answers and politicians fume and watch, some like Robert Quiver of Porcupine aim to take advantage of the CARS program. A program that might provide just the cash needed to upgrade from gas-guzzling clunkers to a gas-sipping new rides.
"I see those Kias, they seem to be looking popular," he said.
Quiver's 1996 Chrysler mini-van is still running, but it's racked up 200,000 miles and had a winter run-in with a tree. The car is worth about $1,000 as a trade-in, but could be worth thousands of dollars more if Quiver uses the CARS program and buys wisely.
That kind of interest is music to the ears of dealers who would appreciate that one extra push toward their car lots.
"In our economy, we got a lot of people driving around in a lot of old cars in this town, and I'd like to see that, for my sake," said Blomstrom, of Toyota of the Black Hills. "I'm a new car sales manager."
Contact Jeremy Fugleberg at 394-8421 or Jeremy.fugleberg@rapidcityjournal.com
Posted in Local on Tuesday, June 30, 2009 11:00 pm | Tags: 07-01-09, Jeremy Fugleberg, Cash For Clunkers, Environment, National Business, President Obama
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