Em­peror Gil­lard in car clunker

Herald Sun - Motoring - - Front Page - Paul Gover

WHEN it comes to cars, Ju­lia Gil­lard is just like the em­peror who goes strut­ting in pub­lic with­out clothes in the 1800s short story by Hans Chris­tian Andersen.

In this case, the Prime Min­is­ter is wear­ing noth­ing de­spite the im­pres­sive elec­tion claims about her cash-for-clunkers scheme. The ba­sics of the pro­posed car-scrap scheme look good, with a $2000 bounty on any pre-1995 gross pol­luter turned in for crush­ing in favour of a green new car. But as you drill deeper you find flaws, and then one fa­tal er­ror.

It all looks sim­ple for any­one who has a pre-’95 car in the fam­ily.

But did you know the car must have been reg­is­tered and in­sured for two years be­fore the trade-in deal? Or that the pa­per­work must match the per­son do­ing the deal?

It’s a way to en­sure that no $20 wrecker’s spe­cials are rolled out by bounty hunters.

Did you also know the cost of a new car against the val­u­a­tion on a 1995 model?

The cheap­est new cars are the Suzuki Alto and Pro­ton S16 at around $12,000. But the re­al­is­tic choices don’t start un­til $15,000.

The cur­rent val­u­a­tions for a ’95 Com­modore or Fal­con is $2400 for an EF GLi or $3000 for a VR Ex­ec­u­tive in av­er­age con­di­tion.

But what about the suc­cess of over­seas schemes? Yes, cash-for-clunkers schemes have worked well in other coun­tries, but most have a bounty of at least $5000.

Any­one do­ing the sums on a clunker deal is prob­a­bly as­sum­ing they get $2000 cash from Can­berra in ad­di­tion to their trade-in. So the num­bers don’t look too bad.

But the clunker is worth zero. It will be go­ing straight to the scrap­yard. There is not a dealer in Aus­tralia who will give a dol­lar for the car. That means the changeover price goes way the wrong way. And don’t for­get the Govern­ment is plan­ning a $2000 bounty on cars which have a trade-in value above that fig­ure.

That’s why Em­peror Gil­lard is wear­ing no clothes.

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