By Mark Huffman
ConsumerAffairs.com
August 18, 2009
The governments "Cash for Clunkers" program has spiked new car
sales and flooded new car showrooms with prospective buyers, excited
about the prospect of a generous government subsidy for a new set of
wheels.
The thousands of "clunkers" that have been traded in over the last few weeks have been hauled off to the scrap heap, removing them from the road. But the Engine Repower Council, an automotive mechanic trade group, says many consumers might be better off keeping their clunkers for several more years.
"If 'Cash for Clunkers' is not for you, repowering the engine of your so-called 'clunker' may be the answer," said Dave Wooldridge, chairman of the Council. "For the cost of an average down payment on a new car or truck, you can repower your vehicle with a remanufactured/rebuilt engine, gaining years of reliable service and improved fuel economy all without monthly car payments and higher insurance rates."
"Repowering" a car is when a mechanic replaces the engine with a new or rebuilt one. While commonly done with boats and work trucks, it has been less common with average automobiles. Wooldridge said consumers should consider it as an option to taking on a large car payment.
According to Edmonds.com, the average car loan payment is $479 per month. Wooldridge estimates that an average of $22,992 can be saved by skipping car loan payments for the life of a four-year loan, making repowering, he says, a sound and cost effective investment.
"Even with the 'Cash for Clunkers' incentive, a one-time investment to repower a car's engine makes more financial sense, extending the vehicle's life and eliminating the additional costs associated with a new car purchase," said Wooldridge.
But while repowering may make economic sense in these times, Americans have not always approached their automobile with that mindset. Drivers like to make a change every few years, and a repowered "clunker," after all, doesnt have that new car smell.
But Wooldridge and his colleagues think perhaps consumer attitudes have changed in the last year. For all the consumers ready and able to take resume the old ways of borrowing and spending, he thinks there are more who want, or need, to spend less and save more.
